The application of the exemptions from the Absentee Owner Surcharge and Foreign Purchaser Additional Duty to build-to-rent developments have been clarified, with the Treasurer’s guidelines now including examples of how these developments may qualify for the exemptions.
The change is part of Victorian Government initiatives to support the build-to-rent sector, where residential properties are built to rent instead of for sale to individual buyers.
Absentee Owner Surcharge exemption
The Absentee Owner Surcharge exemption guidelines have been revised to include examples of how build-to-rent developments may qualify for the exemption.
The exemption will cease to apply when the build-to-rent development is completed as the absentee corporation or the trustee of the absentee trust will then be considered a passive investor or landlord.
The new Absentee Owner Surcharge exemption guidelines apply from the 2019 land tax year.
Foreign Purchaser Additional Duty exemption
The Foreign Purchaser Additional Duty exemption guidelines have been revised to include examples of how build-to-rent developments may qualify for the exemption.
The exemption is intended to apply to foreign corporations or trusts that are Australian based and whose activities in developing or re-developing property adds to the supply of housing stock in Victoria. The effect of an exemption is that the foreign corporation or foreign trust, in which the person has a controlling or substantial interest, will not have to pay the additional duty.
The new Foreign Purchaser Additional Duty exemption guidelines apply to all dutiable transactions and relevant acquisitions occurring on or after 1 October 2018.