Selling Real Estate in Australia - Clearance Certificate
Posted: Tue, 13 Feb 2018 7:09 pm
Hi,
We moved to Singapore a few years and we love it here so we decided to sell our PPOR in Australia, for tax purposes we are no longer considered Australian tax residents.
Our property in Australia is our primary residence so I believe the 6 Year capital gains PPOR rule should apply however the ATO is saying otherwise:
Clearance Certificate and Variation Request rules below:
Residents
To be eligible for a Foreign Resident Withholding Clearance Certificate you must be a permanent resident of Australia for income tax purposes. This certificate enables the resident vendor to avoid the 12.5% withholding.
https://www.ato.gov.au/Forms/Capital-ga ... residents/
Non-Residents
Where the vendor is a non-resident of Australia for taxation purposes, 12.5% of the purchase (sale) price must be withheld by the purchaser on behalf of the vendor. Where the 12.5% withholding rate may be inappropriate, for example, if the amount withheld is too high compared to the actual Australian tax liability on the sale of the asset, a Variation application for foreign residents (online version) may be submitted in order to request to vary the withholding rate lower or to nil. Where the vendor has obtained a variation, the purchaser must withhold the amount that corresponds with the varied rate.
I have applied to the ATO for a variation application for exemption due to PPOR but they will not issue a Clearance certificate or acknowledge the a capital gains exemption?
Doe's anybody know a real estate tax specialist or have any experience with this?
Appreciate any advice.
We moved to Singapore a few years and we love it here so we decided to sell our PPOR in Australia, for tax purposes we are no longer considered Australian tax residents.
Our property in Australia is our primary residence so I believe the 6 Year capital gains PPOR rule should apply however the ATO is saying otherwise:
Clearance Certificate and Variation Request rules below:
Residents
To be eligible for a Foreign Resident Withholding Clearance Certificate you must be a permanent resident of Australia for income tax purposes. This certificate enables the resident vendor to avoid the 12.5% withholding.
https://www.ato.gov.au/Forms/Capital-ga ... residents/
Non-Residents
Where the vendor is a non-resident of Australia for taxation purposes, 12.5% of the purchase (sale) price must be withheld by the purchaser on behalf of the vendor. Where the 12.5% withholding rate may be inappropriate, for example, if the amount withheld is too high compared to the actual Australian tax liability on the sale of the asset, a Variation application for foreign residents (online version) may be submitted in order to request to vary the withholding rate lower or to nil. Where the vendor has obtained a variation, the purchaser must withhold the amount that corresponds with the varied rate.
I have applied to the ATO for a variation application for exemption due to PPOR but they will not issue a Clearance certificate or acknowledge the a capital gains exemption?
Doe's anybody know a real estate tax specialist or have any experience with this?
Appreciate any advice.