Revenue Ruling No. G 011

Surcharge Land Tax and Duty - Residential Premises that are not Dwellings

Ruling no. Issued date Dates of effect Status
From To
G 011 29 November 17 21 June 2016 - Current


  1. From 21 June 2016, surcharge purchaser duty applies to certain dutiable transactions over residential land in NSW. Commencing from the 2017 land tax year, surcharge land tax applies to foreign persons who are owners of residential land in NSW. This Revenue Ruling clarifies where the surcharge will not apply to residential premises.

  2. “Dwelling” for both surcharge purchaser duty and surcharge land tax is defined in section 104I(1) of the Duties Act 1997 as a house, or a room or a suite of rooms (whether or not forming part of a building or a detached building), that is:

    1. occupied or used as a separate dwelling, or

    2. so constructed, designed or adapted as to be capable of being occupied or used as a separate dwelling.

  3. Section 104I(2) provides that a dwelling does not include a reference to a room or suite of rooms determined by the Chief Commissioner not to be a dwelling.


  1. This ruling constitutes a determination by the Chief Commissioner for the purposes of section 104I(2). The following guidelines will help identify the types of premises determined not to be a dwelling by the Chief Commissioner.

  2. Hotels, Motels & Inns will not be dwellings if the premises:

    1. are operated for commercial purposes,

    2. offer accommodation to the public,

    3. provide accommodation on a multiple occupancy basis,

    4. provide central management and services,

    5. do not provide the occupants an exclusive right to occupy any particular part of the premises in the same way as a tenant, and

    6. provide short term accommodation (generally less than 90 days).

  3. Hostels & Boarding Houses will not be dwellings if the premises:

    1. provide lodgers with a principal place of residence for more than 90 days,

    2. are operated for commercial purposes, and

    3. are registered under the Boarding Houses Act 2012.

  4. Student accommodation will not be dwellings if the premises:

    1. are purpose built exclusively for students (regardless of whether the rooms are self-contained),

    2. provide students with a principal place of residence for more than 90 days,

    3. are operated for commercial purposes, and

    4. are made available solely for occupation by students.

    Providing temporary short term accommodation to persons or groups of persons during semester holidays is permitted.

    Note: Accommodation provided to the manager or caretaker, being an individual, is not a dwelling for the purposes of surcharge purchaser duty and surcharge land tax.

    Purpose built student accommodation includes substantially renovated accommodation that:

    1. has been created through renovations in which the whole, or substantially the whole, of a building is removed or replaced (whether or not the renovations involve the removal or replacement of foundations, external walls, interior supporting walls, floors or staircases), and,

    2. as renovated, has not been previously occupied or sold for any purpose other than as student accommodation.

  5. Aged Care and other Care Facilities will not be dwellings if the premises:

    1. provide accommodation in the facility for a person for more than 90 days or provide palliative care,

    2. provide appropriate staffing to meet the nursing and personal care needs of the person,

    3. provide meals and cleaning services,

    4. provide furnishings, furniture and equipment for the provision of that care and accommodation, and

    5. are operated for commercial purposes.

    Note: Does not include a person’s private home where care is provided to a person.

    In some cases, residential care by an approved provider or respite care provided under the Aged Care Act 1997 (Cth) may be included in a retirement village complex. Each facility will be considered on its merits.

  6. Bed and Breakfast accommodation

    A bed and breakfast is generally a private home and will therefore be treated as a dwelling even though it provides temporary or short-term accommodation to the public. However, where a particular bed and breakfast is run on similar lines to, and has all of the features of, a motel, hotel or inn, it may be determined not to be a dwelling under section 104I(2).

    Given the significant variation in different types of bed and breakfast operations, each facility will be considered on its own merits.

  7. Caravan & Home Parks

    Most caravan parks and home parks are excluded from paying surcharge purchaser duty and surcharge land tax. However, long term accommodation in a caravan park or home park may still be liable if any of the features in paragraph 13 of this ruling are evident.

  8. Separately titled rooms, apartments, serviced apartments, cottages and villas

    Separately titled rooms, apartments (including serviced apartments), and cottages and villas on adjoining land will not be treated as dwellings if the premises:

    1. are combined with sufficient commercial infrastructure (for example, reception areas, dining and bar areas, meeting/function rooms, laundry and car parks),

    2. are owned or operated as a whole regardless of whether they are separately titled,

    3. are operated for commercial purposes, and

    4. provide short term accommodation (generally less than 90 days).

    However, notwithstanding the above, such premises will be liable to surcharge if the owner or occupier of the premises is permitted to occupy the premises for more than 90 days per calendar year.

  9. Relevant factors in determining a commercial purpose

    To show that there is a commercial purpose, the operator should be able to evidence:

    1. a genuine intention and a reasonable expectation that the activity is likely to generate a profit, and

    2. the activity is being, or will be, carried on consistently in an organised and efficient manner.

    In determining whether the above elements are present, various factors will be considered including (but not limited to):

    1. repetition, regularity and intensity of that activity,

    2. history and future prospects in relation to income, costs and profit,

    3. characteristics of other businesses within the industry, and

    4. expected commercial viability of the business in the foreseeable future.

  10. Features that indicate that the dwellings are not a hotel, motel, inn, hostel, boarding house or similar premises [1]

    Ultimately, it is necessary to consider the features of each premises to determine whether the overall character of the premises meets the requirements outlined above. While not an exhaustive list, factors that may indicate that premises are dwellings under section 104I(1) and therefore not suitable for a determination under section 104I(2) include:

    1. the operator agreeing with an occupant to provide accommodation for a periodic term (which may be for a period of months or years at a time), such as in a residential lease,

    2. the operator having the right to impose a cleaning fee on an occupant when the occupant ceases to occupy the premises,

    3. an occupant being permitted, subject to the terms of the lease, to alter the premises, such as by attaching hanging devices on a wall,

    4. an occupant being permitted, subject to the terms of the lease, to keep pets in the premises,

    5. an occupant being granted long stay accommodation of more than 90 days (excluding boarding houses and hostels),

    6. an occupant having to arrange and pay for the connection of a telephone, electricity, or gas service,

    7. an occupant being responsible for the cleaning and minor maintenance of the premises, such as changing light bulbs,

    8. the premises being unfurnished,

    9. the right to occupy is granted to an occupant in exchange for the occupant lending an amount to the operator.

  11. Other categories of premises

    Other categories of premises may still be determined not to be a dwelling notwithstanding that some or all of the features outlined in this Ruling are not present. These will be considered on a case by case basis.

Stephen R Brady
Chief Commissioner of State Revenue
29 November 2017


  1. ^ Please note that, while the following features are similar to those listed in the “Goods and Services Tax Ruling GSTR 2012/6”, there are significant differences between the GST legislation and the surcharge provisions of the Duties Act 1997 and the Land Tax Act 1956.
Last updated: 2 July 2018