A foreign investor purchases a new apartment off-the-plan in Melbourne for $800,000. Which taxes and charges apply to this transaction?
Correct Answer
D) Stamp duty, GST and foreign purchaser duty
Foreign investors purchasing new residential property are subject to stamp duty, GST (on new property), and additional foreign purchaser duty. All three taxes apply to this off-the-plan purchase in Victoria.
Why This Is the Correct Answer
Three charges apply: standard land transfer duty; GST, because a developer's sale of new residential premises is a taxable supply, with the GST built into the price and withheld by the buyer at settlement; and Victoria's foreign purchaser additional duty on foreign persons.
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