It was recently announced that the Treasury Laws Amendment (Foreign Investment) Bill 2024 (Cth) (“the Bill”) received Royal Assent. The purpose of the Bill is to clarify the interaction between foreign investment fees, similar state and territory property taxes, and Australia’s double tax agreements to ensure that foreign investment fees and similar imposts prevail and can continue to be imposed on foreign nationals purchasing Australian property.
Previously, citizens of New Zealand, Finland, Germany, India, Japan, Norway, South Africa and Switzerland were not subject to surcharge duty due to international tax treaties. With the recent assent of the Bill, citizens of these countries may now be liable for surcharge purchaser duty if they enter into an agreement to purchase property in NSW on or after 8 April 2024.
Individuals
Individuals of these eight countries will now be subject to surcharge purchaser duty unless they:
- Are ordinarily resident in Australia;
- Are an exempt permanent resident;
- Hold a Partner VISA (subclass 309/820) and meet the residency requirements;
- Hold a Retirement VISA (subclass 405/410) and meet the residence requirements.
Non-Individuals
Individuals acting as trustee, individual partners of a limited partnership and non-individual purchasers/transferees may be subject to surcharge purchaser duty if they are foreign persons solely by reason of a substantial interest being held by a person from these countries.
Updated Purchaser/Transferee Declaration Forms
Revenue NSW have released updated Purchaser/Transferee Declaration forms to be completed on and from April 2024. Previous versions of the form completed for transactions entered into before 8 April 2024 will still be accepted by Revenue NSW.
It is recommended that legal advice is sought prior to entering into any agreement to purchase property in NSW to assess any potential duty liability that may be incurred. The team at Baker Love Lawyers are experienced in all aspects of property purchases and available to assist in assessing your surcharge purchaser duty liability in light of the recent changes.
