Sam Mohammad and Matt Zauner explain the new Additional Foreign Acquirer Duty rules in Queensland.
The Queensland Commissioner of State Revenue (the Commissioner) has recently released three Guidelines to assist taxpayers in determining when the new Additional Foreign Acquirer Duty (AFAD) rules under the Queensland Duties Act will apply. Under the rules, from 1 October 2016, an additional 3 percent stamp duty surcharge will apply to certain dutiable transactions that involve both ‘foreign persons’ and ‘AFAD residential land’.
The three guidelines broadly confirm the Commissioner’s view:
The guidelines also outline the circumstances where the Commissioner will grant ex gratia relief from the AFAD rules for a ‘significant developer’ or a developer undertaking a ‘significant development’.
Under the AFAD rules, the Commissioner can apply to the Supreme Court for an order to sell a purchaser’s land to recover unpaid AFAD. Accordingly, it is important to consider the potential application of the AFAD rules when purchasing residential land, or land capable of being residential land, in Queensland. We have already amassed considerable experience in making successful applications for relief from the similar Victorian provisions, which can be applied in relation to the application of the new Queensland rules to taxpayers.