Foreign investors: changes to rules for property investment

Under proposed changes to Australia’s foreign investment rules (anticipated to start on 1 December 2015), foreign investors (including temporary and non-residents) who invested, or plan to invest, in real estate may need to notify the ATO by certain due dates.

Also, it is anticipated that foreign investors applying to purchase Australian real estate will have to pay a fee from 1 December 2015.

The fee will be collected for assessment of all foreign investment applications, but different fees apply depending on the sale price and type of property.

Residential real estate
Foreign investors who have invested in residential real estate need to make sure they have government approval for their investment.

Investors without the appropriate approvals were required to notify the ATO (through the Foreign Investment Review Board) by 30 November 2015 (possibly entitling them to reduced penalties, including up to 12 months to sell the property rather than a shorter period).

Agricultural land
Foreign investors who invest in agricultural land now need to register on the Agricultural Land Register by 31 December 2015.

New investments or purchases, regardless of their value, must be reported to the ATO on the register within 30 days.

The ATO also needs to be notified when they no longer have an investment in agricultural land.