Changes to the FRCGW Tax Regime took place on 1st January 2025 and will impact all real estate contracts and leases (where a lease premium is paid) entered into.
This change brings lower value property transactions into the FRCGW Tax Regime and will require all sellers of real estate and lessors where there is a lease premium paid (whether or not the seller or landlord are foreign) to provide a clearance certificate.
If a seller has not provided a clearance certificate, buyers will be obliged to withhold 15% of the purchase price from the seller and pay that amount to the ATO.
The key changes include:
Increasing the withholding rate from 12.5% to 15%; and
Abolishment of the threshold of $750,000 so that the withholding rules apply to ALL real estate property sales and leases where there is a lease premium paid.
