What this instrument covers
The Taxation Administration (PAYG Withholding Variation for Foreign Resident Capital Gains Withholding Payments) Legislative Instrument 2026 was registered on 16 September 2026. It is available at https://www.legislation.gov.au/F2026L01231.
Foreign resident capital gains withholding (FRCGW) is the system where a buyer of certain Australian property is required to withhold a percentage of the purchase price and pay it to the ATO when the seller is a foreign resident. This instrument sets out specific variations to those withholding rules.
The five variation scenarios
The instrument carves out or adjusts the standard FRCGW withholding rules for five specific situations:
- Purchases from multiple vendors
- Property acquired due to someone's death (deceased estates)
- Purchases from income tax exempt entities
- Property transfers due to marriage or relationship breakdowns
- Mortgagee sales where no money remains after the mortgage debt is repaid
The instrument does not detail the specific withholding rates or percentage changes applied in each variation scenario.
Earlier rules repealed
This instrument repeals earlier versions of these variation rules, which are listed in Schedule 1 of the instrument. It replaces them with this consolidated version.
Key actions
- Parties involved in property transactions as a buyer, seller, conveyancer, or bookkeeper where a vendor may be a foreign resident can check the full text of this instrument at https://www.legislation.gov.au/F2026L01231 to confirm whether any of the five variation scenarios apply.
- Those who handle deceased estate property sales, relationship breakdown property transfers, mortgagee sales, or purchases from tax-exempt entities can read the relevant variation schedules in the instrument to understand whether standard FRCGW withholding obligations are altered.
- Accountants and tax advisers can review how the updated variation rules affect withholding obligations before settlement on any affected property transaction.
This is a plain-English summary for information only, not legal or compliance advice. Always check the official source or consult a qualified professional.