Selling a property comes with plenty of moving parts – paperwork, deadlines and a seemingly endless list of boxes to tick.
From preparing your home for sale and signing agency agreements, through to organising marketing, negotiating offers and finalising contracts, it can feel like there’s always one more form to deal with.
One step that often catches sellers by surprise is the requirement to obtain a Foreign Resident Capital Gains Withholding (FRCGW) clearance certificate from the Australian Taxation Office.
The good news? It’s a simple process and doesn’t take long to complete.
Despite the name, this certificate is required for all property sellers in Australia, regardless of the sale price, where you were born or how long you’ve lived here. It’s not about nationality – it’s about confirming your tax residency status with the ATO.
Without a valid clearance certificate in place, the buyer is legally required to withhold 15 per cent of the purchase priceat settlement and remit it directly to the ATO.
That can mean a significant portion of your sale proceeds is temporarily tied up, even if you’re ultimately entitled to receive it back.
Thankfully, applying for the certificate is free, done entirely online and generally takes just a few minutes.
Once issued, it’s valid for 12 months and can be used for multiple property sales within that period – particularly helpful if you’re selling more than one property.
Processing times can take up to 28 days, so it’s best to apply early in the selling process rather than waiting until contracts are unconditional or settlement is fast approaching.
Think of the clearance certificate as another small but important item on your selling checklist, alongside providing identification, signing authority forms and confirming bank details.
It doesn’t add complexity to the sale, but it does help ensure settlement runs smoothly – and that you receive your full sale proceeds on the day.
