New Charge for Foreign Owners for Empty Properties
Foreign persons who apply for approval to purchase residential property after 9 May 2017 will face a new annual vacancy charge to be imposed if the property is not occupied for at least six months per year.
The charge will be levied annually and will be equivalent to the purchase application fee imposed at the time the property was acquired by the foreign investor.
Details of the new charge can be viewed HERE
FIRB approval for sale of new apartments limited to 50%
Developers selling under a New Dwelling Exemption Certificate issued by FIRB will now
From July 1 2017, new Commonwealth Government reporting requirements will be introduced that will affect all real estate property transfers in Western Australia.
The reporting requirements are being introduced following agreement by Commonwealth, State and Territory Treasurers to establish a National Register of Foreign Ownership of Land Titles. This Register will be administered nationally by the ATO. In WA, Landgate will collect and report the required information to the ATO.
For each transaction of freehold (and some leasehold interests)
Background: The former government announced on 14 May 2013 that it would introduce a 10% non-final withholding tax on payments made to foreign residents that dispose of certain taxable Australian property. The Bill for this measure, introduced by the current Government has been passed and received Royal Assent on 25 February 2016.
The new withholding regime will apply to contracts entered into on or after 1 July 2016.
Broadly, where a foreign resident disposes of certain taxable Australian property, the purchaser will be required to withhold 10% of the purchase price*.and pay that amount to the Australian Taxation Office (ATO). .
* Note: the legislation specifies that the 10% withholding is actually on the "first element of the cost base". However, as purchase price is understood by vendors and purchasers, and in many instances will equate with the "first element of the cost base", we have used the term purchase price for simplicity.
In case you missed it in all the pre Christmas activities, there is now much more stringent F.I.R.B. (Foreign Investment Review Board) compliance in place.
Complete with application costs and severe penalties for breaches.
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1 December 2015 Media Release
The Turnbull Government’s robust new foreign investment regime comes into force today, providing stronger enforcement and a better resourced system with clearer rules for foreign investors, Treasurer the Hon. Scott Morrison announced today.
"The Government welcomes foreign investment that is not contrary to our national interest. Without foreign investment, production, employment and income would all be lower. But it is important that foreign investment is appropriately monitored to ensure that it benefits all Australians," Mr Morrison said.
"Foreign investment rules need to be strong, effective and enforceable. The changes taking effect today follow the passage of the Government’s Foreign Acquisitions and Takeovers Legislation Amendment Bill 2015. They provide greater compliance powers to the Australian Taxation Office (ATO) and introduce strict new penalties for those caught breaking the rules.
"Foreign investors who have breached the residential real estate rules had until yesterday to voluntarily come forward under the reduced penalty period. From today any investors caught in breach of the rules will face severe penalties.
In an Treasury Exposure Draft changes to FIRB were outlined on 6 July 2015 | Exposure Draft
On 2 May 2015, the Government announced a package of reforms to strengthen the foreign investment framework, including:
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