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    Increased AFAD stamp duty charge for foreign buyers

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    Developers and foreign investors should be aware that in response to the recent Queensland State Budget there will be an increased stamp duty surcharge on foreign buyers for the acquisition of residential property, under the Duties Act 2001, from 1 July 2018.

    The Revenue Legislation Amendment Bill 2018 proposes to amend the Duties Act 2001 to increase the rate of Additional Foreign Acquirer Duty ("AFAD") from the current 3% to 7%.

    The increased AFAD will bring Queensland into line with southern States including South Australia, New South Wales and Victoria.

    As AFAD applies to land that can be used for residential development, not simply houses and apartments, Queensland could become less attractive for foreign residential property development investment against the southern States given the current more competitive AFAD rate.

    You can read our 2016 Alert on 'New Qld Stamp Duty Charge for Foreign Buyers' here which covers the following AFAD topics in greater detail:

    • Foreign Buyers;
    • Residential Land;
    • Types of Transactions Affected; and
    • Exemptions & Concessions. 

    As the Revenue Legislation Amendment Bill 2018 has not yet become law it is unclear what, if any, transitional arrangements will apply to Contracts that are signed before 1 July 2018 but where the liability for stamp duty has not yet arisen. The ClarkeKann Property & Projects team will provide further updates shortly.

    The ClarkeKann Property & Projects team can assist in determining whether a potential transaction will be liable for any additional duty as well as identifying any possible exemptions or concessions that may be available to you.

    For more information, please contact Matthew Armstrong or Paul O'Dea.

     

    ClarkeKann is a commercial law firm in Sydney. Our expertise covers commercial & corporate transactions, financial services, litigation, risk management and insolvency, property transactions and resources projects, across a range of industries. For a full list of our legal services, please visit our website at www.clarkekann.com.au. To update your contact details or unsubscribe to any of our publications, email us at ck@clarkekann.com.au
     
    This bulletin is produced as general information in summary for clients and subscribers and should not be relied upon as a substitute for detailed legal advice or as a basis for formulating business or other decisions. ClarkeKann asserts copyright over the contents of this document. This bulletin is produced by ClarkeKann. It is intended to provide general information in summary form on legal topics, current at the time of publication. The contents do not constitute legal advice and should not be relied upon as such. Formal legal advice should be sought in particular matters. Liability limited by a scheme approved under professional standards legislation. Privacy Policy
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