The 2016-2017 State Budget which was handed down recently
confirms the Treasurer's remarks that Queensland will introduce
a 3% duty surcharge on 'foreign persons' purchasing
'residential land'. Following this, the Duties and Other
Legislation Amendment Act 2016 (Qld) (Act)
received assent on 27 June 2016.
To which transactions, and from which point will the
The 3% surcharge, called 'additional foreign acquirer
duty' (AFAD) will apply to dutiable
transactions involving foreign persons and residential land on or
after 1 October 2016.
Accordingly, AFAD will affect the following types of duty:
Transfer duty – arising from a transfer of land, or an
agreement to transfer land (such as a Contract for Sale or
Landholder duty – that may be involved with some
acquisitions in public or private landholders by a corporation or
listed unit trust; or
Corporate trustee duty – that may be involved in an
acquisition of shares in corporations that hold property on
Foreign persons that are subject to AFAD will be required to
lodge an 'AFAD statement' within 30 days of the relevant
What types of properties are 'residential
Generally speaking, AFAD will apply to land in Queensland that
is used, or will be used, solely or primarily for residential
purposes. The definition extends to established homes and
apartments, vacant land upon which a home or apartment will be
built, land for development for residential use and refurbishment
of a building for residential use.
Who is considered a 'foreign person'?
The definition will include:
A foreign individual (a person other than an Australian citizen
or permanent resident);
A foreign corporation (a corporation that is incorporated
outside of Australia or a corporation controlled by a foreign
person or persons); or
A foreign trustee of a foreign trust (a trust in which at least
50% of the interests in the trust are held by a foreign person or
The Commissioner is entitled to a first ranking charge over the
foreign person's interest in the residential land if there is
any AFAD unpaid.
A proposed purchaser of residential land from a foreign person
will be bound by the charge if it is registered at the time of
disposal. However, the charge cannot be registered if the foreign
person is no longer the registered owner.
Further Application of the Act
In addition, the Act brings about the following noteworthy
First Home Owner's Grant Increase
The current grant of $15,000 that is available to eligible first
home buyers has increased to $20,000, for eligible transactions
entered between 1 July 2016 and 30 June 2017 (inclusive).
Extension of Family Farm Duty Concession
Currently, there is a stamp duty concession available for
transactions involving a transfer of land used for primary
production business (or any adjacent land), or personal property
used to conduct business on the land, between specific family
members. However, its application is limited to where the transfer
is made by way of a gift. From 1 July 2016, this concession will
also be available to an eligible transferee who pays
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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