Ex gratia scheme for the provision of the housing construction grant for new homes in retirement villages
Status: Current
Version Number: 1
Legislation: First Home and Housing Construction Grants Act 2000
Date Issued: 8 November 2013
Revenue Rulings do not have the force of law.
Background
The First Home Housing and Construction Grants Act 2000 (the “Act”) provides for a number of house purchase assistance measures, including the Housing Construction Grant (HCG).
The HCG was introduced on 15 October 2012 to provide an urgent boost to the State’s housing construction industry and help stimulate the property sector. It was intended that all eligible new homes valued up to $450,000 would receive the HCG.
Discussion
A HCG is available in relation to the following new home transactions:
- a contract for the purchase of a new home; or
- a comprehensive home building contract for a new home; or
- the building of a new home by an owner builder.
In all cases the Act requires that the applicant be the owner of the land on which the home is built in order to access the HCG.
For various reasons where new homes have been constructed in retirement villages, parties have been unable to claim the HCG.
In the case of new large scale retirement village developments, it has been identified that the owner of the land will be ineligible to apply for the HCG in circumstances where the whole retirement village is built on one title because of issues in relation to the market value provisions of the HCG.
In view of the underlying policy for the HCG being to encourage the construction of new homes, the Treasurer has approved an ex gratia scheme whereby new homes constructed on land in retirements villages will be eligible for ex gratia relief payments equivalent to the HCG.
The ex gratia relief will in all cases be paid to the owner of the retirement village land when an eligible new home has been constructed as part of a retirement village.
The ex gratia payment will only be available where it is clear that no party would otherwise be eligible to claim the HCG under the Act.
In such instances, the owner of the land on which the retirement village development is built will be eligible to apply for an ex gratia payment in respect of each new home built in the retirement village where the buy-in price for a new home is less than $450,000.
RevenueSA reserves the right to claw-back any ex gratia payment made where it is subsequently determined that the market value of the new home is more than the original buy-in price.
Further Information
Further information relating to the HCG, including the eligibility requirements, is outlined in Information Circular 51 and on www.revenuesa.sa.gov.au.
If you are unsure about any aspect concerning your eligibility, it is important that you contact RevenueSA for clarification before proceeding with your application.
Applications for an ex gratia payment should be made directly with RevenueSA.
This Revenue Ruling applies to all otherwise eligible transactions entered into between 15 October 2012 and 31 December 2013 (inclusive).
Further information can be obtained from RevenueSA.
View this Revenue Ruling as a pdf (PDF 241KB)