The Annual Vacancy Fee - What You Need to Know as a Foreign Housing Investor blog image

The Annual Vacancy Fee – What You Need to Know as a Foreign Housing Investor

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If you are a foreign owner of a residential property, there are some changes in the Annual Vacancy Fee that you should be aware of before you complete your 2018 tax return.

What is the annual vacancy fee?

The annual vacancy fee is part of a comprehensive housing affordability plan by the Australian Taxation Office (ATO) to improve results across the housing spectrum in the country. It is intended to encourage foreign owners of residential properties to make their properties available for rent when they are not in use. Doing this will help in increasing the number of rental properties available for Australians to live in.

Foreign owners of residential properties in the country are required to annually inform the ATO whether their dwelling is occupied or available for rent for at least 183 days (six months) per year.

Foreign owners whose dwelling is not residentially occupied nor truly available for rent for at least six months will have to pay the annual vacancy fee. In addition, those who fail to annually notify the ATO about the status of their residential property will also be liable for the fee.

The annual vacancy fee is equivalent to the Foreign Investment Review Board (FIRB) application fee which is based on the value of the property during the time of purchase.

Who else is it applicable to?

The annual vacancy fee is applicable to foreigners who applied for a foreign investment application and got approved after 7:30 pm (AEST) on 9 May 2017.

The fee also applies to foreign owners who purchased a residential property with a New Dwelling Exemption Certificate that was applied for by a developer after 7:30 pm (AEST) 9 May 2017.

How do I lodge an annual vacancy return?

The annual vacancy fee must be lodged with the ATO after the end of the 12-month period or vacancy year. Once the return has been lodged, the ATO will then assess the amount that you would have to pay if any.

You can go to ATO’s website here to lodge your vacancy fee.


If you need assistance with annual vacancy fees, contact a Chan & Naylor accountant near you, and we’ll be more than happy to help.

Aside from annual vacancy fees, have a look at our other accounting and advisory services that we do to help you achieve greater success.

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Chan & Naylor Group has nationwide offices in North Sydney, South West Sydney, Sydney , Pymble and Parramatta in New South Wales, Melbourne, Moonee Ponds and Hawthorn in Victoria, Brisbane and Capalaba in Queensland, and East Perth in Western Australia that can assist you with your annual vacancy fee compliance as well as any other business or personal tax enquiry that you may have. Contact us today.


Source: Australian Taxation Office

Photo: Stock Photo Secrets

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