Case Study: Foreign Owners – NSW Land Tax Surcharge Voluntary Disclosure
Client Profile:
• Married couple, non-residents for Australian tax purposes
• Own NSW residential property used privately by family (not rented)
• Never previously registered for NSW land tax or surcharge land tax
Background
The foreign-owner land tax surcharge applies to residential land owned by foreign persons from the 2017 land tax year onward.
Under the Land Tax Act 1956 and Land Tax Management Act 1956, Revenue NSW may issue original assessments for any unassessed year, without a 5-year time limit.
Our clients were potentially exposed to surcharge land tax from 2017–2025, and penalty tax and interest.
What We Did
✓ Prepared a structured voluntary disclosure to Revenue NSW
✓ Provided a full property and ownership history
✓ Requested full penalty remission and relief from interest
✓ Explained circumstances and taxpayers’ lack of prior awareness
Result Achieved
Revenue NSW issued assessments only for 2022–2025 and did NOT issue assessments for 2017–2021 — despite legally being permitted to do so.
Significant Savings for Client
Assessments not issued (estimated avoided amounts):
| Year | Rate | Estimated Surcharge |
| 2017 | 0.75% | $1,709 |
| 2018 | 2% | $4,558 |
| 2019 | 2% | $4,558 |
| 2020 | 2% | $4,558 |
| 2021 | 2% | $4,558 |
| Total avoided | — | ~$19,941 per property |
No penalty tax
No interest
Full compliance brought up to date
Key Takeaway
Voluntary disclosure works.
When handled professionally, Revenue NSW may significantly limit retrospective assessments and remit penalties and interest.
If you have foreign clients who own NSW residential property, our firm can assist with:
• Voluntary disclosures
• Surcharge land tax reviews
• Revenue NSW negotiations
• Residency and tax compliance matters