Stephen Jones (Whitlam, Australian Labor Party, Assistant Treasurer) Share this | Hansard source

I thank the member for Petrie for his questions. This is a compliance mechanism. It goes to the capital gains tax that is payable by foreign residents who are selling or purchasing real estate in Australia. It's about ensuring that we have compliance with the existing regime.

Since 2016, Australian residents selling property assets that fall within the regime have needed to obtain a clearance certificate from the Australian tax office to prove to the purchaser that they are not a foreign resident. This ensures that they do not inadvertently incur the non-final withholding tax amounts that the member for Petrie refers to. Applying for the ATO clearance certificate is free, and it's lodged online using basic personal information. For most Australians the certificate is autogenerated. Certificates are valid for 12 months from the date issued and can be applied for at any time.

Important intermediaries, such as conveyancers and solicitors, are very familiar with this, and I'm sure the member for Petrie is familiar with it. They're familiar with the regime and assist people in selling their properties and navigating the process. The overwhelming majority of sales are conducted through intermediaries—conveyancers, lawyers, solicitors—who assist in the conveyancing, and this is one of a number of compliance measures intermediaries go through in advising their clients to ensure that they're in compliance with Australian law.

If an Australian resident does not get a certificate in time for the sale of their property, they will be able to claim a refund from the ATO for the full amount that was withheld. The ATO has advised that, if this circumstance arises, they will prioritise the refund for that taxpayer.

I hope that deals with the questions that have been asked by the member for Petrie.

Bill agreed to.

See this speech in context