Queensland Land Tax & Absentee Surcharge affects all Queenslanders

I have always respected your posts and as what appears to me - you are a registered accountant with intelligent worthy comments. But I must disagree on the point - the ordinarily reside test doesn't give enough leeway IMO. The trip comment is based off one group member (Facebook support group) whom I have conversed with extensively, is involved in drawn out legal battle at the moment against their decision - is someone who with his wife travel extensively (good luck to him and his wife) in their retirement - but of course they failed the 'mainly resided' test. The financial impact has been severe and a shock - they were overseas at the time when the retrospective budget was implemented. Trapped in a backdated legislation - no grandfathering there.

I have no problem with tax on foreign ownership and get the reasoning for this. I am all for Australians being protected from this. But QLD Labor had no need to extend this onto Australian citizens. I am happy to pay usual Land taxes like anyone else. Nobody is saying that we should not pay any taxes. I am well and truly paying my fair share both absent and non-absent. Non-absent - multiple times what I would pay. I am not happy with other tax reforms but at least there is generally a provision to ensure a transition period, grandfathering or exemptions.

The 'Meh' comment is not a fair observation rather a cheap shot that I cannot be bothered with. Of course I don't expect everyone to agree with my opinions. But if you have been caught up in this I am sure your outlook would be far different. There are people suicidal over this.

 

A Minister, Premier or MP has no ability under (any state) QLD law to provide a LT exemption or concession not given or permitted by the Act. The Commissioner has limited powers of concession too. And if a Commonwealth MP tried to intervene they would be ignored.

The CGT implications of a change of trustee would be important. And QLD would subject a trustee ownership as dutiable (in full)

A non-resident trust could also have more serious concerns than just land tax.

 

Not really. You can see it as a cheap shot, my opinion is that it is not worth the effort. The government constantly shifts and changes its taxation policies and people constantly complain about it. The fact remains that the government will continue to do that as they have done it for centuries. Might not agree with your point of view, but doesn’t mean that it is wrong.

This is a broad change that is in line with a lot of other countries. In fact Australia is still, in my opinion, too soft when it comes to such changes.

 

Landowners faced with rising costs need to consider selling as way to avoid the tax. There is no concession for mental health or affordability in the Act. I wouldnt rely on any Facebook group for advice. It will be riddled with misinformation, nutters and others who cant or wont seek professional advice to a problem. Sorry but I tend to dismiss these sorts of post - The law is the law. So it takes a lawyer to advise.

Failing the ordinarily resident test is the key issue I suspect. Legal advice concerning that matter would be the most obvious suggestion. Ordinarily resident, citizen and tax resident all have different meanings determined by among other things, common law. It can even create gaps. A matter for a lawyer.

 

What gets me is why they think as a non resident I’m suddenly a foreigner !!!!!

Why doesn’t Australia put its citizens first ?

 

I have had it confirmed with my international tax accountant.

You can be a tax resident of Australia, pay full income tax and still get hit with this for being on holiday for 6 months and 1 day.

Very disappointing.

 

Oh, but didn't you know ..... we 'apparently' do not pay enough taxes when absent. As a Labor spokesperson stated about Absentees, we were, “generally not subject to the range of taxes used to deliver the high-quality services and infrastructure that ultimately contribute to growth in Queensland property values”.

This statement is of course total BS. Most absentees are paying a whole raft of State and Federal taxes whether absent or not, as well as income and investments being re-invested into the Australian economy from overseas. And infrastructure - depends on where your property is anyway to determine if it will benefit. Not all properties are growing in value either.

The smaller amount of taxes not being paid (e.g. revenue from public transport fees, road tolls, utility charges, GST on shopping, rego fees - that's if you own a motor vehicle in Australia) is well and truly surpassed in multiple amounts by the Land Tax & Absentee Surcharge. Totally and utterly disproportionately more than a non-Absentee. They got by all these years without adding an Australian citizen Absentee Surcharge - but apparently it is so crucial to include Aussies.

People who have been stung - now cannot travel the same as they did before. Has already financially crippled people. People considering working overseas also have to reassess and likely scrap the idea and those already overseas - need to come home unless their salaries can comfortably cover the taxes.
Long Service Leave/career breaks cannot be made extensive overseas anymore. Overseas education pursuits as well - not worth it. All those opportunities are realistically now only for non-QLD property owners - putting Queenslanders at a disadvantage. Welcome to Queensland. Shooting its own people in the foot and making them captives of the State for 6 months a year.

 

I dont agree, its often possible not always the case. Thats a far too literal meaning of the rules. Someone who can demonstrate being ordinarily resident in Australia is not subject to the absentee rules and the 6 month test isnt applicable ON APPLICATION - Form LT16. Merely being absent from Australia on a holiday is not a taxing concern even if its 6 or 7 months. A person with capacity to reside elsewhere for 92+ days (eg typical visa rules) needs to convince OSR that they are ordinarily resident.

Obviously OSR would seek evidence that the absence is temporary eg not working but leisure, where you lived (e g cruising, hotels etc)

Its clear in the plain english explanation which follows the rules in the Act....s31 has a nice little "or" I have marked bold.

If you have lived outside of Australia during the financial year, we will consider several factors to determine if you usually live in Australia, such as the reason for your absence and the time spent in and out of the country. If we are not satisfied that you mainly resided in Australia, you will be an absentee if you:

• were away from Australia at 30 June or
• have been away from Australia for more than 6 months in total during the financial year before 30 June.

31 Meaning of absentee
(1) An absentee is a person who does not ordinarily reside in Australia.
(2) An absentee includes a person who—
(a) can not satisfy the commissioner that he or she ordinarily resides in Australia; and
(b) when ownership of the person’s land is decided for this Act—
(i) is absent from Australia; or
(ii) has been absent from Australia for more than half of the 12 month period

All persons away 6mths + must apply and provide evidence for the Commissioner.

Note also a person who has worked for a employer for at least a year is posted overseas for a period planned to not exceed 5 years can be excluded for the absentee rules. On application.

 

I tried to use the explanation that my usual residence was Australia but they rejected my objection application. I believed I had valid reasons - on tourist visa as well and in temporary accommodation and all of my financial ties are in Australia as well. On top of that I became very ill and a medical specialist at the hospital I was at insisted I was unfit to fly, which was documented on a 'Not Fit to Fly' certificate that was provided to my Travel Insurance - I was unable to return to Australia for 3 more months.
So in my opinion it is at one's own great peril to rely on the interpretations of the OSR Commissioner to be satisfied that you normally reside in Australia.

Best to stick to the 6 month rule to be safe or else do not risk it. To think now we have to go through all of this hell and justifying everything just for going on a bloody holiday longer than 6 months. Needing to convince some bureaucrat for having an extended trip.

Thanks Labor for introducing this B.S. Wish I had never invested in QLD. Would not have this drama if only I had bought my investment property in another State. Freedom verse entrapment.

 

Was it a actual objection to a decision or some admin staffer who declined the request on the LT16 form? That could be a reviewable decision. You may have to object for a formal determination. Appeal? = Judical review - I doubt if this area (ill health 6mths and interaction with ordinarily resident) has been subject to such a test.

60 day appeal time often applies (but can be extended sometimes) Complaints and objections - Queensland Treasury

 

Thanks,
I lodged an objection after LT16 request declined. A determination was made and again rejected. Ill health was noted but among other reasons they stated that there is no provision in the act to exempt for medical reasons. I paid the bill.

 

Hi Paul,

This is why people are so frustrated with this law. My tax accountant specializes in tax for Aussie expats, like I said he has confirmed that if you are a tax resident of Australia that does not satisfy the QLD absentee rules. You can be a tax resident, pay your full amount and then get hit with this.

He noted they are the strictest in all of Australia. Very hard to plan long term on the outcome of an appeal system.

I get the feeling this is Australia getting confused with the meaning of foreigner. Some kind of political correctness stopping the country taking care of its citizens.

 

You shouldn't be taking advice from an accountant on land tax as this is legal advice they are not authorised to give.

You need to look at the legislation. it says nothing about being a tax resident, so this is irrelevant.

s 31 says you must satisfy the commissioner that you "ordinarily reside" in Australia. The word ordinarily is not defined so it takes its ordinary meaning.

but there is an 'and' for the definition of absentee to apply. You must be ordinarily resident AND be absent from Australia on the taxing date OR ...

So one way you could potentially meet the requirement is to 'ordinarily reside' here and be present on the taxing date - 30 June.

Do some research into the phrase 'ordinarily reside' and see if there is any case law on this - from land tax or revenue QLD aspects. if not you could look at income tax case definitions.

The definition will be something like where you permanently dwell, where your domicile is, where your home is.

State Revenue QLD are not strict. They are just following the law - the commissioner doesn't make the law, but just implements it.

And be careful what you put on the immigation card when entering the country - think they have abolished them for going out.

 

The departing is electronic and arriving is now paper/electronic with plan to phase paper out at all intermational terminals. I just had a client subjected to audit for his touchscreen response at Sydney airport. ATO admitted that.

 

got to keep your story straight!

 

A (summarised extract + abridged for clarity) quote from an edited version of an ATO audit decision regarding evasion and the resulting penalties decision :

"You told us that you could not comply with the s264 Notice issued on..... as you had to travel overseas for urgent work. You were given an extension which was given for that purpose. However in the period following you did not comply with the s264 notice by the extended date allowed by the Commissioner. We determined from passenger movement cards that you also did not depart Australia at anytime in that period or at anytime thereafter. Your later representations of ill health when you sought further extension of the s264 notice, and it was granted, is not supported by evidence of medical attendance determined from our obtaining Medicare and private health fund records of treatments and claims. There is also no record of you attending a public or private hospital.

We consider that you have attempted to evade honestly attending to enquiries and notices by making dishonest representations.......

We conclude that we cannot place reliance on any of your representations......"

You can see where that went.

 

Interesting that they no longer collect the reason you departed, only that you departed on this day on this flight or ship. On the old paper card you had to answer D, E or F:

Your answer to D, E or F obviously had big implications... but this is not collected anymore? There is no touchscreen when you depart, only when you enter.

 

Its like google and facebook. International data sharing incl visa, airlines and offshore data builds a real time and more accurate picture. Its like arrivals cards ...Ticked No for food. We all know from TV that its not accurate !!

Apparently 15% of departure cards werent accounted for in the final years and made ABS data unreliable along with incomplete or factually wrong cards. It wasnt an actual mandatory requirement they now admit.

3401.0 - Overseas Arrivals and Departures, Australia, Jul 2017

 

Those who check my postings on my blog would be well aware that our constitution (Commonwealth of Australia Constitution Act 1900 (UK)) specifically prohibit discrimination between citizens in regard of taxation. Tyson the ex police officer refer to being unconstitutional but failing to state what he is talking about. Because someone says it is unconstitutional doesn't mean it is. You need to explain why this is so, as I did on my blog. The video I saw failed to show the web link details (of Peter and Tyson) and also failed to show Tyson's contact details. I am not a legal practitioner but a CONSTITUTIONALIST and now retired Professional Advocate and for example on 19 July 2006 defeated the Commonwealth of Australia (and other Attorney-Generals) on constitutional grounds that compulsory voting was unconstitutional. I also defeated the commonwealth on 5 August 2005 that AVER (Averment) cannot apply merely because the Commonwealth legislated for it as unless a state legislated for this it cannot be relied upon and the court ordered the Commonwealth to file and serve all material it sought to rely upon. Counsel for the commonwealth argued that would be truck loads but the court maintained its decision that the Commonwealth had to file and serve. If therefore anyone contemplate to make a legal challenge against any land taxation of any or all States then I view a competent lawyer should succeed in it. A competent lawyer must be deemed a lawyer who is open minded and understand the true meaning and application of the constitution. Again I have posted it all on my blog!

 

Constitutionally municipal and shire council rates are a DELEGATED state land taxation (Sydney Council v Commonwealth, HCA 1904). However the Commonwealth on 11 November 19120 commenced to legislate as to land taxation by this wiping out the State powers to apply land taxation. The previous CONCURRENT legislative powers (meaning either one could legislate) became a exclusive Commonwealth legislative power as from 11-11-1910. While the Commonwealth did repeal its land taxation legislation since 1952 in certain manner nevertheless once a Commonwealth exclusive legislative power then it always will be so. during Kirstine Keneally being Premier NSW her Minister claimed in his writing to me that the State had been regaining the legislative land taxation powers. Yet, our constitution doesn't allow for any federal legislative power to be returned to the States.
I view any taxation agent/lawyer who doesn't understand know this is failing to act in the best interest of his/her client(s).
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