As part of the Queensland Government’s 2015/2016 budget measures, it will be introducing a 3% Additional Foreign Acquirer Duty (“AFAD“).
This duty will be payable by foreign residents or entities who are purchasing residential land or property in Queensland and will come into effect from 1 October 2016. The duty will be in addition to the liability to pay transfer duty, landholder duty or corporate trustee duty in a transaction.
The rationale for this further tax is to ensure that foreign residents who gain the benefit of government services and infrastructure make a contribution to these services as they will not necessarily be required to pay other government taxes.
Foreign residents thinking of purchasing residential land in Queensland should move quickly to avoid this new tax. Care will also need to be taken to ensure that following 1 October 2016, foreign residents acquiring residential property don’t forget to pay.