Build to rent
Build-to-rent is a multi-unit development with a unified ownership structure where the property is held for rental purposes.
The NSW Government has introduced an exemption from surcharge purchaser duty for new build-to-rent housing projects until 2040.
The purpose of this exemption is to address one of the barriers to the provision of rental services and, by doing so, improve the rental experience for tenants. By limiting the benefit to new developments, where the transfer was entered into on or after 1 July 2020, this is expected to help support new construction.
How the exemption is applied
The exemption is expected to support the supply of large-scale rental housing that are professionally owned and managed, and that provide tenants with greater security of tenancy and greater quality rental services.
If the requirements are satisfied, a full or partial exemption will be applied upfront, or a refund (full or proportional) of the surcharge purchaser duty will be granted in line with an order made by the Treasurer.
When to apply
On or after 1 July 2020, after the transfer has been entered into:
- An application for exemption may be made at the same time documents are lodged for assessment of ad valorem duty. The granting of approvals prior to the completion of the build-to-rent development may be considered where there is evidence of the developer’s commitment to the development and operation of a build-to-rent property.
Where surcharge purchaser duty has been paid on a transfer entered into on or after 1 July 2020, an application for reassessment and refund must be made:
- within 12 months after the owner of the land concerned first became entitled under section 9E of the Land Tax Management Act 1956 to a reduction in the value of the land, and
- no later than 10 years after completion of the transfer of the residential-related property to the Australian corporation.
For pre-transaction approval on transfers entered into on or after 1 July 2020:
- An ‘exempt transferee’ may, for future transactions, be exempted from surcharge purchaser duty. Approval as an exempt transferee may be subject to specific conditions which could be imposed
- The granting of pre-transaction approvals may be considered where there is evidence of the developer's commitment to the development and operation of a build-to-rent property.
How to apply
Applications for exemption or reassessment must be submitted using the eDuties portal.
The submission must set out the grounds for exemption or reassessment together with documents and a declaration that the purchaser/transferee is eligible for an exemption as it has met (or will meet) the requirements as set out in:
Note: A Revenue Ruling detailing the operation of this scheme and providing further details on the required documentary evidence will be published once available.
For all applications, your lodgement will need to include:
- a cover letter outlining your submissions, and
- a copy of the original contract for the sale of land in full, and
- a copy of the rendered transfer document from the ELNO workspace, and
- a completed purchaser/transferee declaration PDF, 234.93 KB, and
- a corporate diagram/company search for the liable entity.
For reassessments, the lodgement will need to include:
- a copy of the original stamped/original contract for the sale of land in full, and
- a copy of the stamped/original instrument of transfer, or rendered transfer document from the ELNO workspace, and
- a copy of the evidence of endorsement, and
- copy of the completed purchaser/transferee declaration PDF, 234.93 KB, and
- a corporate diagram/company search for the liable entity.
Applications for pre-transaction approvals must also be made by way of submissions via the eDuties portal.
The exemption cannot be processed on EDR, and paper and emailed lodgements will not be accepted.
Processing of refund payments
Refund payments will be processed by electronic funds transfer, and applicants must submit their details by completing the provide EFT details for refund form.
Eligible applicants will then receive further instructions on how to proceed.
