Kameleddine v Chief Commissioner of State Revenue [2017] NSWCATAD 42

Background

This Applicant sought review of the decision by the Chief Commissioner of State Revenue (“the Commissioner”) to not approve payment to the Applicant of the First Home Owners Grant (“FHOG”) of $15,000.00 in respect of her purchase of a property at Rutherford (“the property”). The Applicant also sought review of the Commissioner’s decision to reject the Applicants First Home New Home stamp duty exemption which was previously allowed in the sum of $12,597.84.

On 3 August 2010, the First Owner entered into a contract for sale of the property to Osman’s Home Improvements Pty Ltd (“the Second Owner”).

On 2 June 2014, the Second Owner entered into a contract for sale of the property with the Applicant. On both occasions the property had not been occupied previously and was partially constructed at the time of sale.

On 6 January 2014, the Applicant application for the FHOG was rejected by the Commissioner on the basis that the property was not a ‘new home’ as it was not the first sale of the property.

On 28 February 2015, the Applicant objected to the Commissioner’s decision and commenced occupation of the property on 18 April 2015. The Commissioner disallowed the Applicants objection on 9 October 2015 on the basis that the property had been previously sold by the First Owner to the Second Owner as a place of residence.

Relevant legislation

The key issue in these proceedings was whether the Applicant satisfied the eligibility requirements pursuant to s. 13(1)(a) of the First Home Owner Grant (New Homes) Act 2000, specifically whether the contract was for the ‘purchase of a new home’ in NSW.

The definition of ‘home’ and ‘new home’ are found in ss. 4 and 4A of the Act, respectively.

Decision

In relation to the Applicant’s entitlement to the stamp duty exemption, the Tribunal held that it had no jurisdiction under s.96 of the Taxation Administration Act 1996 (“TAA”) to deal with the application as there was no evidence that the Applicant had lodged an objection with the Commissioner that had been disallowed, which is a necessary precondition to jurisdiction.

The second matter for determination was the Applicants entitlement to the FHOG. In order to obtain the grant the Applicant must comply with the eligibility criteria as outlined in s. 7 of the Act.  An eligible transaction is relevantly defined in s.13 of the Act as a contract made on or after 1 October 2012 for the purchase of a new home in New South Wales. The contract must be for the purchase of a new home as defined in s.4A of the Act.

However, in order to be a new home, SM Isenberg found that the property must satisfy the definition of a ‘home’ in s. 4 of the Act, which relevantly provides that it is a building that may lawfully be used as a place of residence. Section 109M(l) of the Environmental Planning and Assessment Act 1979 outlaws the occupation of a new building unless an occupation certificate has been issued.

From the Applicant’s submissions it was determined that the Occupation Certificate was issued on 15 April 2016. As such it was found that the property could not have been lawfully occupied as a residence before 15 April 2016, despite the Applicant residing in the property from 18 April 2015.

Accordingly, the Tribunal held that, on completion of the purchase transaction, the property was not capable of being lawfully used as a place of residence and as such the purchase transaction was not a “home” pursuant to s. 4 of the Act and therefore not an eligible transaction for the purposes of the Act.

Orders

1. The Tribunal has no jurisdiction in respect of the application under the Duties Act 1997 and that application is refused.
2. The decision under review in respect of the application under the First Home Owner Grant (New Homes) Act 2000 is confirmed.

Link to decision

Kameleddine v Chief Commissioner of State Revenue[2017] NSWCATAD 42