Mid-Year Economic and Fiscal Outlook 2023–24 - Changing the FRCGW Threshold

For property lawyers or conveyancers assisting clients sell their property, the Mid-Year Economic and Fiscal Outlook 2023–24 to change the foreign resident capital gains withholding tax (FRCGW) regime threshold will add another layer of costs for their clients.

Currently, sellers are required to obtain an ATO FRCGW clearance certificate where the sale price exceeds $750,000. The proposed change applies where the contract is entered into from 1 January 2025 to reduce the withholding threshold from $750,000 to $0 will mean that an ATO FRCGW clearance certificate will automatically be required to be obtained. Furthermore, the FRCGW rate is to be increased from 12.5% to 15%.