ATO clearance certificates for the sale of property

From 1 January 2025 all Australian tax residents selling Australian real property must have a clearance certificate to provide to the purchaser at, or before, settlement.

This applies to all property sales, whereas before January 2025 a certificate was only required for property with a market value exceeding $750,000.

Without a clearance certificate, the purchaser will be required to withhold up to 15% of the sale price (or market value if not sold at arm's length) and remit this directly to the ATO. Once withheld the seller will need to wait until they lodge their tax return for that relevant year to claim the credit back as a refund.

We recommend any clients that are in the process of selling a property, or considering a sale, to obtain a clearance certificate from the ATO as soon as possible. They will be valid for 12 months once issued.

Certificates can be obtained via the ATO online here Foreign Resident Capital Gains Withholding | Australian Taxation Office, or our office can also apply for this on your behalf.

Please feel free to contact our team if you have any questions or require any assistance with the above.