Foreign persons (which includes natural persons and corporations) or foreign trusts that acquire an interest in residential land in South Australia are required to pay a foreign ownership surcharge (the “surcharge”) of 7% of the value of the interest in residential land.
The surcharge applies to:
- instruments liable to duty (including a statement under Section 71E); and
- in the case of an acquisition under Part 4, transactions liable to duty;
entered into on or after 1 January 2018.
The surcharge payable is in addition to the duty that is otherwise payable on an acquisition of an interest in land.
Section and Part references relate to the Stamp Duties Act 1923, unless otherwise specified.
An 'acquisition' refers to a conveyance, transfer or acquisition of an interest or, in the case of an acquisition under Part 4, a notional acquisition of an interest in residential land.
When does the surcharge apply from?
The surcharge only applies to:
- dutiable instruments executed, or taken to have been executed; and
- in the case of an acquisition under Part 4, transactions entered into;
on or after 1 January 2018.
As such, dutiable instruments executed or taken to have been executed, or in the case of an acquisition under Part 4, transactions entered into, prior to 1 January 2018 are not liable to the surcharge.
If a contract predates the effective date of the foreign ownership surcharge legislation but settlement takes place after 1 January 2018, is the full Surcharge payable?
The foreign ownership surcharge applies. The Commissioner of State Taxation has no discretion to waive the foreign ownership surcharge.
When does the surcharge apply and to what to extent does it apply?
The surcharge applies where:
- residential land
- a part of residential land; or
- an interest in residential land
The surcharge of 7% is payable only to the extent of the value of the interest acquired in the residential land.
Find out more on our Applicable Transactions page.
Joint tenants are taken to be tenants in common in equal shares.
How is the surcharge calculated?
The surcharge is calculated based on the value of the interest in residential land, being the value used for duty purposes. The surcharge is in addition to any duty payable.
Find out more on our Calculation of surcharge page.
When is the surcharge paid?
The surcharge is paid at the same time that stamp duty is paid.
Find out more on our Payment of surcharge page.
Is a foreign entity, which is a member of a group that is liable to land holder duty under Part 4, also liable for the surcharge?
For the purposes of the land holder provisions under Part 4, a ‘foreign entity’ means a foreign person or a foreign trust.
In addition to the group being liable to land holder duty under Part 4, a foreign entity that is a member of a group that notionally acquires an interest in residential land is liable to pay a surcharge on the value of the interest notionally acquired by the foreign entity.
The Foreign Ownership Surcharge in South Australia is administered under the following legislation:
- Stamp Duties Act 1923
- Stamp Duties Regulations 2013
- Taxation Administration Act 1996.
When contacting us please provide your property information (such as address, ownership number, site details, etc) and conveyancer information, where applicable.
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