The Bill has passed and received Royal Assent on 30 November 2017 for the Commissioner of Taxation to charge a vacancy fee to foreign residents owning an investment property in Australia that is not occupied.   This has been popularly called a “ghost tax”.

The fee only applies to non-Australian tax residents who own a residential property that was “vacant” for more than 183 days in a financial year.

A residential property is “occupied” (ie not “vacant”) when:

(a)  the owner or his/her relatives genuinely lives in the property,

(b)  the property is under a lease or licence for a minimum of 30 days, or

(c)  the property is genuinely available for lease or licence for a minimum of 30 days.

If the property is classed as “vacant” (ie not “occupied”), then the owner of the property will need to file a “Vacancy fee return” to the Commissioner of Taxation and pay the vacancy tax.