Queensland Law Society

Foreign resident CGT withholding changes

On 1 June 2017, amending legislation was introduced to the Federal Parliament to amend the Taxation Administration Act 1953 (Cth) to modify the foreign resident capital gains withholding payments regime to:

  • increase the withholding rate to 12.5%; and
  • reduce the withholding threshold to $750,000.

View the Bill and Explanatory Memorandum.

If the legislation is passed, the changes to the threshold and withholding rate are proposed for contracts entered into on or after 1 July 2017. The existing threshold and rate will apply for any contracts that are entered into before 1 July 2017, even if they are not due to settle until after 1 July 2017.

These changes were announced on 9 May 2017 as part of the 2017-18 Budget and were discussed in Lexon’s Risk Alert on 16 May 2017.

QLS is reviewing the drafting of the standard QLS/REIQ contracts with respect to changes that will be required if the legislation is passed. QLS will keep members informed as the legislation progresses.

The Australian Tax Office will be conducting webinars about the changes on:

Tuesday 13 June 2017 from 8.30-9.30am – registration available

Monday 19 June 2017 from 1-2pm – registration available