Background
In 2017 and 2018, the taxpayer, Mr Nguyen, and his then business partner, Mr Dinh, acquired 3 lands. Following an investigation, the transfers were assessed to foreign purchaser additional duty (FPAD) under s28A(2) of the Duties Act 2000 (Duties Act). Under s28A, FPAD applies to the transfer of properties to foreign purchasers, even when they are transferred to 2 people jointly and one of those is an Australian citizen or permanent resident.
Issue
The case turned on whether Mr Dinh was a ‘foreign purchaser’ within the meaning of s3(1) of the Duties Act at the time of the transfers. That is, whether he was the holder of a permanent visa within the meaning of s30(1) of the Migration Act 1958 (Cth) (Migration Act) at the time of the transfers.
The Commissioner submitted that, at the time of the transfers, Mr Dinh held a Bridging Visa A (subclass 010) and later a Bridging Visa B (subclass 020) at the relevant times which were not permanent visas within the meaning of s30(1) of the Migration Act.
Decision
On 30 May 2023, the Tribunal dismissed the taxpayer’s application (save for the variation of the reassessments to reflect the Commissioner’s proposal to not claim penalty tax and interest).
In written reasons dated 21 June 2023, the Tribunal confirmed that Mr Dinh’s visa status at the relevant times meant that he was a ‘foreign purchaser’ within the meaning of the Duties Act and FPAD was payable by the taxpayer and Mr Dinh on Mr Dinh’s 50% share of the 3 properties they owned jointly. The taxpayer was jointly and severally liable for the whole amount of reassessed FPAD.
