The NSW Government announced last week that the NSW residential land foreign person surcharge provisions are inconsistent with international tax treaties entered into by the Federal Government with New Zealand, Finland, Germany and South Africa.
Effective immediately, individuals that are citizens of the nations concerned purchasing NSW residential-related property, or land in their own capacity, will no longer be required to pay surcharge purchaser duty or surcharge land tax.
Surcharge purchaser duty or surcharge land tax liability for non-individuals, such as corporations, trusts or partnerships that arises because of an entity’s affiliation with these nations, may also be affected by the international tax treaties.
Refunds may be available for purchasers/transferees and landowners from the nations concerned who paid surcharge purchaser duty or surcharge land tax on or after 1 July 2021. This means, for example, the relief should cover the 2022 and 2023 surcharge land tax assessments and may even cover previous year’s assessments where they were paid from 1 July 2021. Revenue NSW has indicated that it will identify affected landowners in due course.
The 2023 land tax assessments (which include land tax surcharge where it is payable) may have already been received or should be receivable between January and March. Landowners in receipt of such an assessment are invited to call their Mazars advisor to discuss what amount they should pay.
There is no indication that refunds will be available for duty and tax paid before 1 July 2021. The announcement does not affect ordinary transfer duty and land tax liabilities – only the surcharges. It does not appear that this relief will be also found to apply to citizens of other countries.
Mazars understands that the other Australian states with equivalent residential land surcharges for foreign persons are reviewing their own schemes to determine if they are similarly affected.
For further information please contact your usual Mazars advisor or alternatively one of our experts via the form below or on:
Author: Stephen Baxter
All rights reserved. This publication in whole or in part may not be reproduced, distributed or used in any manner whatsoever without the express prior and written consent of Mazars, except for the use of brief quotations in the press, in social media or in another communication tool, as long as Mazars and the source of the publication are duly mentioned. In all cases, Mazars’ intellectual property rights are protected and the Mazars Group shall not be liable for any use of this publication by third parties, either with or without Mazars’ prior authorisation. Also please note that this publication is intended to provide a general summary and should not be relied upon as a substitute for personal advice. Content is accurate as at the date published.