Foreign investors. Smashed in NSW Budget

Foeign buyers in NSW are in for more pain. 8% duty surcharge and 2% land tax surcharge. Ouch...Time to call DFAT and apply for ciizenship

 

When will someone call it and see that removing foreign buyers has moderated auctions ?? Media seem to have focussed on 1st July as if prices will suddenly rise / collapse. I dont think so BUT these tax changes have to impact foreign funds.

One of the largest groups affected are foreign students. Parents send then a bucket of money and they buy. Its all subject to land tax and duty surcharges. Detection ?? I reckon it will take time before OSR goes on the hunt for avoiders.

 

I got my citizenship in May yay

I wonder, how many foreign students buy property while they're still in uni?

 

Highlights a risk for anyone investing OS (not just Aus) you are an easy target for government revenue raising. No backlash as you can't vote and popular with nationalist segments of the local community.

 

when i was consulting to a University in Australia the registrars had to organise for the delivery of a ferrari to get around town to one of the students from her father a member of the royal family in Dubai

 

The duty surcharge is one off? where as land tax surcharge is annual?

 

Yes

But LMI is no longer subject to stamp duty

 

Interesting budget item $27m cost for antiradicalisation in jails.

That a hell of a lot of bullets.

 

We expect it will impact the market but with the usual lag time, won't show up in official cg statistics for another 6 mths or so. We deal with foreign buyers and the charges are certainly making a difference in sentiment and decision-making. Interestingly, lots of off-market properties coming out of the woodwork with very "motivated" sellers keen to capitalise on what they view as a glut of foreign buyers keen to do a deal before July 1.....the further 4% increase on surcharge is significant.

 

Motivated developers holding property and sweating?

 

Most of these changes were forecast back in May after the Federal Budget was announced.

Foreigner's will now pay Regular Stamp Duty + 8% Foreigner Duty Surcharge + 2% Land Tax/Year. So possibly upto 15%.

Coupled with Federal Budget changes

First home buyer grants, stamp duty exemptions and discounts in NSW

Developers can be exempted, but their are conditions for the exemption.

 

Is this non citizens or non residents? I've been a PR for the past 20 years.

 

Stamp duty of >10% on foreigners has caused significant price drops in Canada. NSW will be different?

 

Can be either. A PR is allowed a concession BUT must reside here in THAT property and there is a test based on days. ie a PR cannot own other property without the surcharge.

If the PR owns one IP valued less than the land tax threshold they must register for land tax. They will get a nil land tax assessment and a $X surcharge assessment.

 

Ouch! They're stripping away the benefits of being a PR
How does the OSR know if the PR have become a citizen?

 

They will have their ways. And a clearance certificate or a random audit etc = penalties. I'm expecting to process for clearance certificates to change to address this issue. They will seek evidence of birth, citizenship and the like as part of the process.

The budget was framed around raking in more tax revenue. You can expect they will seek to find it.

 

I pressed "like" on your post, even though I dislike the content of it immensely!
Thanks for the info.

Looks like I'll have to get my permission from the German government to take the Australian citizenship and then apply for that as quickly as I can!

 

What happen if you don't ask for permission?

 

a few years ago...lots, perhaps on behalf of some other family members- nevertheless, with suitcases full of cash. I love BRICS money