Overseas Entity- Investing in AUS property

If an overseas entity (with non AU residents behind it) was to purchase property in AUS, does the ATO have some requirements the entity needs to comply with? Eg does it need ABN, TFN, pay tax etc.

I have tried searching the ATO website without much luck.

Cheers
 
Foreigners are allowed to buy property in major developed countries like the UK, the USA and Japan. Why do we in Australia have laws that discriminate against foreigners when we face no such hurdles in many overseas countries. Work out the morality/hypocrisy for yourself.

I suspect nobody at the ATO would notice that the shareholders of an Australian registered company are based overseas. So yes, this would be a sneaky way for an overseas resident to buy Aussie property.

However, the company would have to pay CGT once the property was sold. Fleecing the ATO for tax owed can potentially earn the protagonists behind the company a stiff jail sentence. That is certainly something you should consider, more so because Australia has extradition agreements with most foreign countries.
 
is your question equity as in a property overseas or is it buying a equity position in a property here like a jv
the answers so are are to do with buying a equity position
you can use equity from any where and its not not taxed at all
as equity is a security not a investment
and there is no grey line
the issue is not the equity
its the income or payment for the use of that equity
this is an income or payment and it does depend on the structure you have used to gain and distribute that income and what type of entity that is
is this a hypo or a real question if real then
equity funding from over seas is done all the time and there is no tax on equity if that is infact your question.
and the firb has changed in a very big way and a few of the answers so far posted are on the old system
the new allow under certain perameters investing in resi
put this is direct investing
there is a very big difference from direct investing
and equity investing
equity you are passive and just get a return on your equity
direct you are the investor
and the rules are very different
so need to know or clarify which you are talking about
 
There are several issues here:

Registration of title. Foreign companys can be registered with ASIC in Australia and receive an ACN number, and then get an ABN etc. ASIC registration is needed if the company is conducting a business in Australia. However, registration does not appear necessary if the company is just buying property. eg. For NSW see http://rgdirections.lands.nsw.gov.au/land_dealings/dealings_involving/companies

FIRB: Approval will be necessary

Tax: If the company will be renting the property then you will need to look into withholding taxes. These will vary depending on the country of residence of the company. Also need to consider whether this fits in to the definition of running a business and thereby requiring ACN, ABN, GST registration etc. A TFN would be needed too as a tax return would be needed to be lodged.
 
Hi Welcome

Terry mentioned "FIRB: Approval will be necessary". I always tell my overseas friends that one of the easy ways to invest in residential real estate in Australia, is to buy a block of land and build a house on it. The FIRB website shows this to be a pretty staightforward process:

"Vacant Land

Proposed acquisitions of vacant land for residential development are normally approved subject to development condition(s) imposed under the FATA.

Acquisitions of single blocks of vacant land (that is, land which is zoned to permit the construction of no more than one residential dwelling per block of land) for the purpose of building a single residential dwelling on each block are normally approved subject to the following condition:

•continuous substantial construction must commence within 24 months.

Acquisitions of other vacant land (not single blocks) for the purpose of building multiple residential dwellings are normally approved subject to the following conditions:

•continuous substantial construction must commence within 24 months; and

•at least 50 per cent of the acquisition cost or the current market value of the land (whichever is higher) must be spent on development.
Once these conditions have been fulfilled, properties acquired under this category may be rented out, sold to Australian interests or other eligible purchasers, or retained for the foreign investor's own use."


Cheers, Paul
 
Top