Foreign persons seeking to acquire residential property in Australia must be aware of the requirements imposed by the FIRB. The FIRB (Foreign Investment Review Board) is a non-statutory body that advises the Australian Government and the Treasurer regarding Australia’s Foreign Investment Policy. All foreign persons must receive approval from the FIRB before they can acquire any Australian interests. This article is the third of a multi-part series that aims to provide some guidance on FIRB approval. In particular, this article will aim to shed some light on the FIRB application process. Please note that this article does not constitute legal advice and you should always consult a professional before applying. If you are concerned about missing out on a property, you can enter into a purchase contract as long as it is conditional upon receiving FIRB approval.
Broadly, you will have four main obligations if you buy a property under FIRB:
- lodge the Residential Real Estate application form and await your approval;
- register the purchase of your residential property using a Land and Water Registration Form;
- if applicable, lodge an Annual Vacancy fee return; and
- ensure you update both the Annual Vacancy fee return yearly and if there are any changes in your situation, the Land and Water Registration Form too.
Applying for FIRB Approval
If you have found a residential dwelling you would like to purchase or have entered into a purchase contract subject to FIRB approval, you must now apply for FIRB approval. Unlike other FIRB applications which must be applied through the FIRB, applications to purchase residential real estate is done through the Australian Taxation Office’s foreign investment application portal. You must pay the relevant fees when you apply as the ATO will not consider your application until you have paid. A full schedule of the payable fees may be found here.
Registering Your Purchase
Once you have received approval, you can proceed to settle the transfer of the residential property. You must then register your purchase within 30 days of settlement by completing the Land and Water Registration form on the ATO’s website.
Annual Vacancy Fee and Changes in Circumstance
If your residential property is not residentially occupied or rented out for more than 183 days (6 months), you must pay a vacancy fee on that property. This fee has to be paid yearly as long as the property is vacant for the specified time period. The exception to this fee is if you can show that the residential dwelling could not be residentially occupied (i.e. because the house is structurally unsound, or the person who ordinarily lives there is currently in hospital or medical care).
You must also update the ATO if your situation changes. If for example, you sell the property, you are no longer a foreign person or the property is no longer residential, you must complete another Land and Water Registration form to remove your registration.
If you would like any assistance in applying for, or managing your obligations under FIRB, email Straits Lawyers at email@example.com or call us at 08 8410 9069.
Please note that this article does not constitute legal advice and Straits Lawyers will not be legally responsible for any actions you take based on this article.