If you’re planning to sell Australian property, it’s crucial to obtain a clearance certificate from the Australian Taxation Office (ATO) before settlement. Without one, the purchaser is required to withhold up to 15% of the sale price and remit it to the ATO under the Foreign Resident Capital Gains Withholding (FRCGW) rules.

Who Needs a Clearance Certificate?

All Australian tax residents selling property must apply for a clearance certificate and provide it to the purchaser before settlement. This applies to:

• Individuals, companies, trusts, and self-managed super funds selling property.
• Sales of residential, commercial, and vacant land.

Why Apply Early?

Most clearance certificates are issued within a few days, but some can take up to 28 days if additional processing is required. Applying early ensures you avoid unnecessary delays or funds being withheld.

What Happens If You Don’t Have a Clearance Certificate?

If a certificate isn’t provided at or before settlement, the buyer must withhold 15% of the sale price and pay it to the ATO. The withheld amount can only be refunded when you lodge your next tax return, which could delay access to your full sale proceeds.

How to Apply

Applications are made online through the ATO. We can assist you with the application process to ensure everything is in order.

If you are thinking of selling or need assistance with your clearance certificate application, please contact us as soon as possible.

For more information you can visit the ATO Website.

As always, do not hesitate to contact us.



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SaabTeece