If you are an Australian resident selling property, you now need to get a Foreign Resident Capital Gains Withholding (FRCGW) clearance certificate or have money withheld when the property settles.

Briefly, as an individual selling property you must apply for a clearance certificate from the ATO and provide the certificate to the purchaser before settlement.

If you don’t provide this certificate, the purchaser MUST withhold 15% of the sale price (or in some cases, 15% of the market value). You won’t get this money back until after your next tax return is processed by the ATO after 30 June.

The ATO advises that certificates should be issued within a few days but to allow up to 28 days. Certificates are valid for 12 months so getting organized early is a good plan.

Certificates are FREE OF CHARGE if you apply directly to the ATO. There are some businesses offering to apply for these certificates on your behalf for a fee. Solicitors and conveyancers should be able to help if you’re not comfortable applying yourself.

As is usually the case, there are exceptions and differences in process for other entity types.
Please refer directly to the ATO for specific information.