More Red Tape has been put in place by the Office of State Revenue as from 21st June, 2016 in respect of Residential Land purchases. Identifying transfers to foreign nationals so as governments may impose additional Duties and Taxes on foreigners is the reason for the new rules.
Foreign nationals will have to pay 4% extra on the normal stamp duty applying to residential land. Land Tax Surcharge on Foreign nationals also applies at .075% of the value of the land and there is no threshold. It also seems that Land Tax (which is levied annually) may also be payable by existing residential lands held by foreign nationals.
Exemptions apply to Australian Citizens, some New Zealand Citizens and Foreign nationals who have resided in Australia for 200 days or more in the last 12 months provided they complete an 8 page form.
The ‘Purchaser Declaration’ form needs to be completed on entering a Contract for the purchase of residential land so as to obtain an exemption from these Duties and Taxes. Australian Citizens will need to provide a copy of an Australian Birth Certificate or Passport or Citizenship Certificate. Kiwis will require their passport and a special category visa and long term foreign nationals will need to provide evidence of their residing in Australia for 200 days or more. Corporations will need a lot more paper work to obtain an exemption or partial exemption.
All-in-all, the bureaucrats are putting more obstacles in front of Purchasers of land and you need to be guided through this maze by your solicitor.
For further information contact us.