On 1 January 2019, foreign transfer duty and foreign landholder duty came into effect by amending the Duties Act 2008. The additional 7% duty applies to acquisitions of residential property where the buyer or transferee are foreign persons, including foreign companies and trusts.
What does this mean to you?
Every buyer or transferee that acquires or purchases land in Western Australia is now required to complete and lodge a Foreign Transfer Duty Declaration Form within two months of executing the dutiable transaction.
If you represent a buyer acquiring land in Western Australia you are required to obtain a completed declaration form from each buyer or transferee. When you self-assess transactions using Online Duties you must retain a copy of the declarations form(s) on file.
Who is responsible for making a declaration?
The buyer/transferee is responsible for completing the declaration form. A representative for a buyer cannot sign a declaration form on behalf of the buyer.
If you are representing a buyer who you believe has made a false or incorrect declaration, the transaction and declaration form must be lodged for assessment with the Commissioner of State Revenue.
Can I use PEXA or other e-Conveyancing networks if the buyer is foreign?
If the transaction involves foreign persons that are acquiring residential property you will not be able to settle electronically. These transactions will need to be completed in paper.
How do I calculate the total duty payable?
Foreign transfer duty is 7% of the dutiable value of the residential property. For example, where a foreign person purchases a home for $400,000 the foreign transfer duty would be $28,000 and transfer duty at the residential rate would be $13,015. The total duty payable on the transaction is $41,015.
The transfer duty calculators can be used to calculate duty estimates.
What is available to help buyers understand their obligations?
State Revenue has recently published support materials on our website to assist buyers and their representatives in understanding foreign buyers duty.
A customer education program is currently being offered, which includes face-to-face sessions, you can register to attend a session. Contact duties enquiries for all other assistance.
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