Foreign Acquisitions

  • Under Australia’s Foreign Investment legislative framework, certain amendments have been made that may affect foreign purchasers, such as the introduction of application fees for residential and commercial purchases. Foreign purchasers who purchase residential property valued at $1 million or less will see a $5000.00 application fee applicable from the 1 December 2015.
  • Further, the existing penalty regime will be vastly expanded for those who breach FIRB rules which may include both civil and criminal charges and penalties.

Changes to the Land Tax Act

  • In addition to the recently introduced additional duty of 3% imposed on foreign purchasers, buyers who do not ordinarily reside in Australia may attract an additional land tax of 0.5%. For a property valued at $1 million, for example, will result in an additional duty of $5000.00 for the first year. Changes will also affect a co-purchaser who may not be an ordinary residents of Australia which may result in an adjusted additional land tax payable.

A number of important details are yet to be clarified including how the question of absenteeism will be assessed and monitored. Assessment of land tax will begin at midnight on the 31st December 2015, and will formally come into play on the 1 January 2016. More information is available at http://www.sro.vic.gov.au/aos

For further information and consultation, please contact JT Lawyers.