New rules on foreign investment18 May 2015 by News Desk
The government has introduced new rules covering foreign investment in Australia.
Prime Minister Tony Abbott said: “Foreign investment is integral to Australia’s economy and we welcome all investment that is not contrary to our national interest. Under the new foreign investment rules all residential real estate functions will be transferred to the Australian Taxation Office.
Fees are to be levied on all foreign investment applications. For residential properties valued at $1 million or less, foreign investors will pay a fee of $5,000. Higher fees will apply to more expensive residential properties as well as business, agriculture and commercial real estate applications.
There will also be increased scrutiny around foreign investment in agriculture and increased transparency on the levels of foreign ownership in Australia through a comprehensive land register.
Third parties who knowingly assist a foreign investor to breach the rules will also now be subject to civil and criminal penalties, including fines of $42,500 for individuals and $212,500 for companies. Criminal penalties will be increased to $127,500 or three years imprisonment for individuals and to $637,500 for companies. A civil penalty will capture any capital gain made on divestment of a property.
“Australia’s foreign investment policy for residential real estate is designed to increase Australia’s housing stock but there has been a lack of enforcement over recent years and investors have profited from breaking the rules. The new rules will come into force on 1 December 2015,” said Prime Minister Abbott.