FPAD is imposed under the *Duties Act 2000* (Vic) on certain acquisitions of residential property by foreign purchasers. It is charged in addition to ordinary land transfer duty. The relevant assessment can depend on the dutiable value, the purchaser's legal and beneficial interests, and the date and structure of the transaction.
The definition of a foreign purchaser is technical. It may distinguish Australian citizens, permanent residents, New Zealand citizens and temporary residents, and it can apply differently where property is acquired jointly or through a company or trust. A spouse or domestic partner exemption may be available in limited circumstances, but it is not enough simply to be married to an Australian citizen. The statutory requirements, including ownership form and any principal-place-of-residence conditions, must be met.
FPAD is not the same as approval under the federal foreign investment regime. A buyer may need to consider both. A federal exemption does not necessarily establish an exemption from Victorian FPAD, and payment of FPAD does not replace any required federal approval.
CMK Legal's property and conveyancing team can act on matters like this.
Do not rely only on the nationality of one buyer or the fact that a property will be occupied as a home. Check each purchaser's status, the ownership proportions, the type of entity acquiring the property and the current State Revenue Office rules before signing.
Law referenced: *Duties Act 2000* (Vic); State Revenue Office guidance on foreign purchaser additional duty.