Following their previous announcement on 21 February 2023, Revenue NSW (RNSW) has announced further changes to Surcharge Purchaser Duty and Surcharge Land Tax in New South Wales (NSW) on 29 May 2023.
RNSW announced on 21 February 2023 that NSW surcharge provisions are inconsistent with international tax treaties entered into by the Australian Federal Government with New Zealand, Finland, Germany, and South Africa. On 29 May RNSW announced that the NSW Surcharge provisions are also inconsistent with Australia’s international tax treaties with India, Japan, Norway and Switzerland. As such, changes will be made to the treatment of Surcharge Purchaser Duty and Surcharge Land Tax in NSW to provide exemptions for residents of New Zealand, Finland, Germany, South Africa, India, Japan, Norway and Switzerland.
It was also announced that refunds may now be available for purchasers/transferees and landowners from the eight nations concerned, who paid Surcharge Purchaser Duty or Surcharge Land Tax on or after 1 January 2021 (previously 1 July 2021).
What are your next steps?
Individuals who are citizens of New Zealand, Finland, Germany, India, Japan, Norway, South Africa or Switzerland, and have paid either Surcharge Purchaser Duty or Land Tax in NSW, may be eligible for a refund. While we note that RNSW has stated they will actively identify those that are eligible for a refund, we recommend that potentially eligible individuals actively engage with RNSW.
Non-individual entities such as corporations, trusts or partnerships may also be entitled to a refund if they have been deemed foreign persons solely by reason of a substantial interest, (or an aggregate substantial interest), being held by a person from New Zealand, Finland, Germany, India, Japan, Norway, South Africa or Switzerland. We also recommend that these types of entities consider whether they are entitled to any potential refunds.
As yet, no other jurisdiction has publicly confirmed whether similar changes will be implemented to their regimes. We note that Victoria initially stated in February 2023 that it would not follow a similar approach to that of NSW. We will continue to monitor and comment on developments as they arise.
To discuss these changes and how they may impact you, please contact your local BDO adviser.