Foreign Buyer Duty
Navigating the expectations of buyers in understanding their requirement to remit foreign buyer duty is inevitable. The declaration must be made by the buyer and it is strongly advised that you do not assist buyers in making any determination on their behalf where there is any doubt.
Foreign individuals are classified as an individual who is not an Australian citizen, or does not hold a permanent or special category visa. In other words, if you are either (i) Australian citizen; (ii) Australian permanent visa holder; or (iii) a special category visa holder – you are not foreign.
Confusion can occur when dealing with New Zealanders who benefit from close ties to Australia. OSR have noted that:
- A person who is not an Australian citizen, or does not hold a permanent or special category visa.
- A permanent visa allows a person to remain in Australia indefinitely as an Australian permanent resident.
- A special category visa is granted to New Zealand citizens who wish to visit, stay or work in Australia.
Provided a New Zealand citizen has a valid special category visa when they acquire the property, they will not be liable to pay foreign transfer duty. If the visa lapses, is cancelled or revoked for any reason prior to settlement, they would need to notify OSR.
It is recommend you advise your clients, where doubt exists, to submit a web enquiry or contact OSR on 9262 1100.
To find out more refer buyers to the Visa Holder Enquiry tool for visa enquiries hosted by the Department of Home Affairs.
Source: 23rd January 2019 AICWA e-Newsletter