Law Companion Ruling LCR 2016/5A3

What this ruling is about: Omit the preamble; substitute: 2. Paragraph 2 Omit footnote 1. 3. Paragraph 4 (a) After 'subsection 14-235(5)', insert 'of Schedule 1 to the Taxation Administration Act 1953 '. (b) After the paragraph, insert new paragraph 4A: 4. Paragraph 5 (a) Omit the wording of the paragraph (excluding footnotes 2 and 3); substitute: (b) After 'where the vendor of the asset is a relevant foreign resident', insert new footnote 1A: (c) Omit footnote 4. 5. Paragraph 6 Omit 'purchasers of certain types of capital gains tax assets (CGT assets)'; substitute 'a purchaser of a certain type of CGT asset'. 6. Paragraph 7 Omit the wording of the paragraph (excluding footnote 6); substitute: 7. Paragraph 7A (a) Omit the wording of the paragraph; substitute: (b) Omit the wording of footnote 6A; substitute: (c) After the paragraph, insert new paragraph 7B: (d) At the end of new paragraph 7B, insert new footnote 6B: 8. Paragraph 16 (a) Omit '12.5%'; substitute '15%'. (b) Omit the wording of footnote 8A; substitute: 9. Paragraph 18 Omit 'CGT roll-over'; substitute 'capital gains tax (CGT) roll-over'. 10. Paragraph 21 Omit the wording of footnote 10; substitute: 11. Paragraph 28 Omit ' Gallant Company Ltd '; substitute ' Gallant Company Co '. 12. Paragraph 29 (a) Omit ' 2017 '; substitute ' 2025 '. (b) Omit all instances of ' Gallant Company Ltd '; substitute ' Gallant Company Co '. 13. Paragraph 30 Omit ' ITAA 1997 '; substitute ' Income Tax Assessment Act 1997 (ITAA 1997) '. 14. Paragraph 31 (a) Omit ' Space Limited '; substitute ' Space Co '. (b) Omit all instances of ' Gallant Company Ltd '; substitute ' Gallant Company Co '. (c) Omit ' $2.5 million '; substitute ' $3 million '. (d) After ' Nebula Co at settlement ', omit the comma. 15. Paragraph 38 (a) Omit ' 12.5% '; substitute ' 15% '. (b) Omit the wording of footnote 10A; substitute: 16. Paragraph 41 Omit ' $12.5 million '; substitute ' $15 million '. 17. Paragraph 51 (a) Omit '12.5%'; substitute '15%'. (b) Omit the wording of footnote 13A; substitute: 18. Paragraph 53 (a) Omit ' In December 2017 '; substitute ' In December 2025 '. (b) Omit ' $400,000 (12.5% of $3.2 million) '; substitute ' $480,000 (15% of $3.2 million) '. (c) Omit ' $400,000 is accounted for, the net proceeds remaining at settlement, $2.8 million '; substitute ' $480,000 is accounted for, the net proceeds remaining at settlement, $2.72 million '. 19. Paragraph 54 Omit ' will fall $200,000 '; substitute ' will fall $280,000 '. 20. Paragraph 64 Omit the wording of footnote 14; substitute: This Addendum applies from 1 January 2025. Commissioner of Taxation 29 July 2026 © AUSTRALIAN TAXATION OFFICE FOR THE COMMONWEALTH OF AUSTRALIA You are free to copy, adapt, modify, transmit and distribute this material as you wish (but not in any way that suggests the ATO or the Commonwealth endorses you or any of your services or products).






This Addendum is a public ruling for the purposes of the Taxation Administration Act 1953. It amends Law Companion Ruling LCR 2016/5 to reflect amendments made by the Treasury Laws Amendment (2024 Tax and Other Measures No. 1) Act 2024. | LCR 2016/5 is amended as follows: | If this Ruling applies to you, and you correctly rely on it in good faith, we will apply the law to you in the way set out in this Ruling. That is, you will not pay any more tax or penalties or interest in respect of the matters covered by this Ruling. | 4A. All legislative references in this Ruling are to Schedule 1 of the Taxation Administration Act 1953 , unless otherwise indicated. | 1A Section 14-210 sets out whether the vendor is a foreign resident for the purposes of the withholding obligation. | For transactions entered into on or after 1 July 2016 and before 1 July 2017, the amount payable to the Commissioner was 10% of the asset's purchase price, unless the Commissioner exercised the discretion under section 14-235 (the variation power) to vary the amount or classes of amounts. 6 A withholding threshold of $2 million applied. | The withholding rate increased to 12.5% and the withholding threshold reduced to $750,000 for transactions entered into on or after 1 July 2017 and before 1 January 2025. These changes affected transactions involving TARP or indirect Australian real property interests giving rise to company title interests. 6A | Treasury Laws Amendment (Foreign Resident Capital Gains Withholding Payments) Act 2017. | 7B. For transactions entered into on or after 1 January 2025, the withholding rate is 15% and applies to all property values (with no threshold). 6B | 6B Treasury Laws Amendment (2024 Tax and Other Measures No. 1) Act 2024 . | Applicable rate for transactions entered into on or after 1 January 2025. | The vendor will need to demonstrate that it satisfies the continuity of ownership test, or same or similar business test under Division 165 of the ITAA 1997. | For further guidance on market valuation, refer to Market valuation of assets .