If you're planning to sell your property in Western Australia, there's an important piece of legislation you need to be aware of – especially from 1 January 2025.
Whether you're a local homeowner or an investor, the ATO's Foreign Resident Capital Gains Withholding (FRCGW) rules now affect every property sale in Australia, no matter the price. And if you're not prepared with the correct documentation – namely, a Clearance Certificate – you could lose 15% of your sale price at settlement.
At Hedges Property Group, we're here to make sure you're informed, protected, and confident every step of the way. Let's break it down.
What Is a Clearance Certificate?
A Clearance Certificate is a document issued by the Australian Taxation Office (ATO) to confirm that a property seller is an Australian resident for tax purposes.
Without this certificate, the buyer is legally required to withhold 15% of the purchase price and send it to the ATO – even if you've lived in the home your whole life.
What's Changed in 2025?
As of 1 January 2025, two significant changes came into effect:
· Withholding rate increased from 12.5% to 15%
· No more value threshold – previously, only properties over $750,000 were affected.
· All properties, no matter the sale price, are subject to these rules.
This means every seller – even those selling entry-level homes or investment units – must apply for and provide a clearance certificate.
What Happens If I Don't Get a Clearance Certificate?
If you don't provide the certificate before settlement, the buyer must withhold 15% of the sale price and pay it directly to the ATO. That's money you'll only be able to recover later by lodging a tax return – which could take months.
Example:
You're selling your property for $600,000.
No clearance certificate? The buyer will pay $90,000 to the ATO, and you'll only receive $510,000 at settlement.
How Do I Get a Clearance Certificate?
· Apply online through the ATO website
· It's free, and most are processed within a few days
· Valid for 12 months, so you can apply even before listing your property
👉 Apply here
Key Tips for Sellers in WA
1. Apply early – don't wait until an offer comes in
2. Use your full legal name – it must match your name on the property title
3. All owners need one – for joint ownership, each party must apply separately
We're Here to Help
At Hedges Property Group, we're more than just real estate agents – we're your advocates. We guide our sellers through every step of the selling process, including compliance with the latest legal and tax changes.
If you're thinking of selling in 2025 or beyond, let's chat early so we can ensure your sale goes smoothly with no surprises at settlement.
(08) 9401 4887
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