Sladen Snippet – Foreign person duty surcharge to increase to 7% from 1 July 2016 and related changes

The Victorian Government has passed legislation to increase the duty surcharge on purchasers of residential property by foreign persons to 7% for contracts entered into from 1 July 2016. The changes contain a number of other changes to the foreign purchaser duty regime. Those changes include: 

  • expanding the concept of residential property to property that is capable of being used primarily as residential property (eg even if it currently isn’t)
  • expanding the concept of residential property to include short term accommodation (which includes a hotel, motel, serviced apartment, retirement village or student accommodation)
  • expanding the concept of intending to construct a residential building to include intending to undertake land development (which can be triggered by merely applying for a permit, applying for rezoning or a plan of subdivision)

The changes also include an increase in the land tax surcharge for foreign absentee owners from 0∙5% to 1∙5%.

For advice or further information please contact:

Phil Broderick
T: 03 9611 0163
M: 0419 512 801

Melissa Brazzale
T: 03 9611 0161