Revenue NSW has announced last week that the NSW surcharge provisions are inconsistent with international treaties entered into by the Federal Government with New Zealand, Finland, Germany and South Africa.
This announcement will affect citizens of New Zealand, Finland, Germany or South Africa who own residential-related property in their own right, as well as residential-related property owned by corporations, trusts, partnerships or governments affiliated with New Zealand, Finland, Germany or South Africa.
Examples of affiliation may include, but are not limited to; country of incorporation, shareholders, unit holders, or beneficiaries of a trust, who are citizens of the affected nation or trustees of a trust established in one of these countries.
What this means for you
- For individuals: If you are a New Zealand, Finland, Germany or South Africa citizen, and have paid surcharge duty and/or surcharge land tax on the acquisition of residential-related property on or after 1 July 2021, you may be entitled for a refund.
- For non-individuals: Any transaction for the acquisition of residential-related property entered on or after 1 July 2021 involving corporations, trusts, limited partnerships or governments affiliated with New Zealand, Finland, Germany or South Africa, and have paid surcharge duty and/or surcharge land tax on the acquisition may be entitled for a refund. An application must be lodged with Revenue NSW for assessment to determine whether the surcharge purchase duty applies.
If you have any questions or would like us to make an application for refund on your behalf, please do not hesitate to contact our taxation team.
Update
Effective from 8 April, citizens of New Zealand, Finland, Germany, India, Japan, Norway, South Africa, and Switzerland became subject to surcharge purchaser duty and surcharge land tax due to changes in federal law.
In early 2023, Revenue NSW had exempted these foreign citizens from surcharge taxes, citing inconsistencies with international tax treaties entered by the Federal Government. However, the Treasury Laws Amendment (Foreign Investment) Act 2024, effective from 8 April 2024, has now clarified these inconsistencies.
