Joseph Craig
There is a new legislation that will take effect from July and it will require property lawyers to take further measures when it comes to validating luxury homes sellers.
A Clearance Certificate will be issued to sellers of estates that has a market value of $2 million and above. This will take effect as of 1st July, 2016. The Clearance Certificate will also act as a proof to verify that the property vendors are Australian citizens.
However, there is an alternative for foreign vendors whereby they will be required to pay tax even without the clearance certificate. They can satisfy the need of paying tax by simply providing 10% of the buying price to the ATO.
“It is important for property lawyers to follow the new process,” said Neville Senders, who is the current president of Real Estate Institute of Australia. Mr. Sanders stressed on this after throwing his support behind the new property law. He said that the GST was responsible for withholding tax process that came into effect in the real estate market.
He added that in order to ensure settlements proceeded without delay, lawyers and other legal professionals needed to get clearance certificates for their clients in a timely manner.
“A larger pool of lawyers may be affected by the rising property prices,” said Peter Maloney, who is the current CEO of GlobalX Legal Solutions. He added that imperative conveyancers and legal professionals should be prepared when these changes come into effect on 1st July because they will affect the growing number of luxury homes amongst Australian sellers and buyers.
In addition, the new law will help do away with unnecessary delays in the settlement process. “However, this can only be met if legal professionals take correct precautions,” said Mr. Maloney.
