Clearance Certificate required to prove Australian citizenship
If your property is worth more than $750,000 and you are planning to sell soon, legislation changes on 1st July 2017 will directly impact your sale.
At the moment, vendors selling properties worth over $2 million must apply for a clearance certificate to prove they are not a foreign investor. If you fail to comply, the ATO will withhold 10% of the settlement price.
The new rules will now apply to properties valued over $750,000 and failure to supply a clearance certificate will incur a 12.5% withholding tax.
Few home owners are currently aware of these changes and it is anticipated that many vendors may be caught out, if not alerted by their real estate agent or conveyancer.
With the average house price in Botany at around $1,500,000, these changes will have an impact on most of MyPlace Estate Agents’ clients. Basically, owners need to realise that they will be treated as a foreign resident unless they prove otherwise.
In most cases, vendors can expect to receive a clearance certificate in less than two weeks and your conveyancer should be able to guide you through the process.