“Ten Pound Poms” & Foreign Ownership

Published On: 26 October 2023
Foreign Ownership and The ‘Ten Pound Pom’ Dilemma

A recent property purchase had a delayed settlement because the purchaser did not realise they were considered a “Foreigner”.

Foreigners

Foreign persons (which includes natural persons and corporations) or foreign trusts that want to purchase property in South Australia are charged a foreign ownership surcharge of 7% of the value of their interest in the land. This is on top of the duty that is owed when purchasing property. The Surcharge came into effect on 01/01/2018.

For instance, if a foreign person buys a property for $100,000 then they will pay an additional $7,000 on top of the Stamp Duty that needs to be paid at settlement.

Those who do not have to pay the surcharge must prove they:

  • Are Australian born
  • Hold an Australian passport
  • Are an Australian citizen
  • Hold a Permanent Resident Visa with the meaning of Section 30 (1) of the Migration Act
  • Are a New Zealand Citizen who is the holder of a special category Visa within the meaning of Sect 32 (1) of the Migration Act

You are not considered a foreign buyer if you live overseas but are an Australian citizen or an Australian permanent resident.

‘Ten Pound Poms’

The ‘foreigner’ who experienced a delayed settlement  came to Australia from the UK with their Parents in the 1960s under the scheme referred to as “Ten Pound Poms“. They had not travelled overseas since then and didn’t think they would have to apply for Residency/Citizenship.  They also didn’t realise that since 1 January 2018 they were classed as a “Foreigner” if they were going to buy a residential property in Australia.

Delayed Settlement

The settlement was delayed for several weeks while the purchaser contacted Home Affairs to obtain the documentation to prove their Permanent Residency Status. This meant that they were in default under the terms of their Contract and could have had to pay a penalty due to the default.

Luckily, the seller was very understanding and allowed the purchaser the time needed to get their documentation together. There were no penalties charged and the Contract (and deposit) remained in place.

Not born in Australia?

If you were not born in Australia, and don’t have Australian Citizenship, and you want to purchase property, then before you start your property search check that you have the necessary documentation to show that you hold a Permanent Residency Visa.

If you are a ‘ten pound pom’ Revenue SA has advised that they you may be classed as having an ‘absorbed person’ visa – but you must provide your conveyancer with these details:

  1. What country you were born and your date of birth
  2. The age you were when you migrated to Australia
  3. What year you migrated
  4. If you have left Australia since first arriving – this may change your requirements if you have gone overseas
  5. If you have held an Australian passport

If you want to check if you hold a Permanent Residents Visa these websites could help:

Revenue SA – Foreign Ownership Surcharge

VEVO (VISA Entitlement Verification Online – Home Affairs)
Phone: 1800 040 070

Department of Home Affairs