Foreign Ownership Register and Vacancy Fee Returns After Settlement

Three separate stages foreign buyers should understand

Foreign buyers should distinguish between three different parts of the Australian foreign investment process.

1. Approval before acquisition

A foreign person will generally need to notify the Australian Taxation Office before acquiring Australian residential land, regardless of the property value.

This stage concerns whether the proposed acquisition is permitted and what conditions may attach to the approval.

2. Register notification after the relevant event

After buying or selling residential land, the relevant action must be notified through the Register of Foreign Ownership of Australian Assets.

This is not the same as the earlier application for approval. It records the foreign ownership interest and subsequent changes affecting that interest.

3. Annual vacancy fee reporting

A foreign owner of residential property may also need to lodge a vacancy fee return for each applicable vacancy year.

The return addresses whether the property was residentially occupied or genuinely available for rent for the required period.

What is the Register of Foreign Ownership of Australian Assets?

The Register of Foreign Ownership of Australian Assets records certain interests held by foreign persons in Australian land and other Australian assets.

For a foreign buyer of residential property, the register notification is a post-acquisition compliance step. It does not replace the need to obtain approval before entering into an acquisition where approval is required.

Buyers should therefore avoid assuming that the approval notice, contract, settlement statement or title registration automatically completes every federal reporting requirement.

When registration should be addressed

Register notification should be considered whenever a foreign person:

• acquires Australian residential land;
• disposes of Australian residential land;
• changes the nature or extent of a registrable interest;
• ceases to be a foreign person, where the reporting rules require notification;
• becomes a foreign person while holding a relevant Australian asset; or
• experiences another event that changes previously registered information.

The precise event and reporting period depend on the legislation and the type of interest involved. Buyers should not wait until the end of the financial year to ask whether notification was required.

What information may be needed for registration?

A foreign owner should keep the documents and information needed to identify the buyer, property and acquisition.

This may include:

• the buyer’s legal name and contact details;
• passport and foreign investor identification details;
• company or trust details where an entity acquired the property;
• the property address and title particulars;
• the contract date;
• the settlement date;
• the acquisition price;
• the foreign investment approval or exemption details;
• the nature and percentage of the ownership interest; and
• details of any later sale, transfer or change in ownership.

The information used for the register should remain consistent with the contract, transfer documents, approval records and ownership structure.

What is a vacancy fee return?

A vacancy fee return is an annual reporting obligation associated with certain foreign-owned residential property.

Its purpose is to establish whether the property was residentially occupied or genuinely available for rent for the required part of the vacancy year.

The return is different from:

• the initial foreign investment application;
• the register notification following acquisition;
• an Australian income tax return;
• a Queensland land tax return; and
• normal property management statements.

A foreign owner should not assume that having no vacancy fee payable means that no return needs to be considered.

What is the vacancy year?

The vacancy year is generally the relevant 12-month period used to assess the occupation and rental availability of the property.

The first vacancy year may begin when the foreign owner first has the right to occupy the dwelling. Depending on the property, this may relate to settlement, completion of construction or the issue of an occupancy certificate.

The vacancy year does not necessarily align with:

• the calendar year;
• the Australian financial year;
• the owner’s income tax year; or
• the lease term used by a property manager.

Owners should record the correct commencement date rather than assuming that reporting begins on 1 July or 1 January.

When can the annual vacancy fee apply?

Current official guidance states that an annual vacancy fee may apply where the property is not residentially occupied or genuinely available for rent for more than 183 days during the relevant year.

The practical question is not simply whether the property was used at some point during the year. The owner should be able to demonstrate qualifying residential occupation or genuine rental availability for the required period.

Potential risk situations include:

• the property being kept mainly for occasional family visits;
• the property remaining furnished but unoccupied;
• the owner delaying the appointment of a property manager;
• the asking rent being set at an unrealistic level;
• the property being unavailable for extended renovation periods;
• the property being used mainly for short holiday stays; or
• there being insufficient records to prove genuine rental availability.

Does short-term accommodation count?

Foreign owners should not assume that listing a property on a short-stay platform automatically satisfies the vacancy fee rules.

Short stays, holiday use and conventional residential leasing may be treated differently depending on the facts and applicable requirements.

Relevant considerations may include:

• the duration of each stay;
• the total period of occupation;
• whether the property was genuinely available to residential tenants;
• the terms of the letting arrangement;
• periods blocked for the owner’s personal use; and
• the records available to support the claimed use.

Owners relying on short-term accommodation should obtain specific advice rather than assuming that booking activity alone is sufficient.

What records should a foreign owner keep?

Foreign owners should maintain a clear documentary record for the entire vacancy year.

Useful documents may include:

• the contract and settlement statement;
• the foreign investment approval notice;
• the register submission confirmation;
• occupancy certificates for newly completed dwellings;
• residential tenancy agreements;
• property management agreements;
• rental listing records and advertising history;
• correspondence with prospective tenants;
• rental ledgers and income records;
• bank statements showing rent received;
• utility usage records;
• insurance records;
• repair and maintenance records;
• travel records where the owner or family occupied the property;
• short-stay booking records, where relevant; and
• copies of vacancy fee returns and payment confirmations.

Records should be retained even where the owner believes that no fee will be payable.

Example: apartment used for family visits

A foreign buyer acquires a new Brisbane apartment and uses it for several family visits during the year.

The apartment is not leased to a residential tenant and remains unavailable during long periods because the family wants to use it when visiting Australia.

Occasional personal use does not necessarily establish that the property was occupied or genuinely available for rent for the required period. The owner should assess the vacancy fee position and keep accurate occupancy records.

Example: property advertised but not rented

A foreign owner appoints a property manager and advertises the property, but no tenant is secured for several months.

The owner should retain evidence showing:

• when the property was listed;
• the advertised rent;
• the platforms or agencies used;
• enquiries and applications received;
• reasons applications were rejected; and
• whether the property remained genuinely available.

Merely asserting that the property was available may be less persuasive than retaining a complete documentary record.

What happens when the property is sold?

A foreign owner selling Australian residential property should consider whether the disposal or change in ownership must also be notified through the register.

The seller should also retain:

• the sale contract;
• settlement records;
• details of the purchaser;
• the disposal date;
• the ownership percentage disposed of; and
• records of any outstanding vacancy fee return obligations.

Selling the property does not necessarily remove an earlier reporting or payment obligation.

Foreign buyer compliance in Queensland is layered

Register and vacancy fee obligations are only part of the legal framework affecting foreign property buyers.

A Queensland transaction may also involve:

• foreign investment approval before acquisition;
• restrictions on purchasing established dwellings;
• contract conditions protecting the buyer while approval is pending;
• Queensland transfer duty;
• Additional Foreign Acquirer Duty;
• foreign-owner land tax considerations;
• AML/CTF identity and source-of-funds checks;
• verification of identity and authority;
• electronic conveyancing requirements; and
• post-settlement register and vacancy reporting.

Completing one requirement does not automatically satisfy the others.

Post-settlement checklist for foreign owners

1. Confirm the settlement and ownership details. Check that the registered owner and ownership percentage match the approved and contracted structure.
2. Complete the required register notification. Do not assume that the conveyancing registration automatically completes the foreign ownership notification.
3. Record the first vacancy year date. Note the relevant commencement date and reporting deadline.
4. Decide how the property will be used. Clarify whether it will be occupied, leased, kept for family use or offered through short-term accommodation.
5. Appoint a property manager promptly if leasing. Retain the management agreement and advertising records.
6. Keep evidence throughout the year. Do not wait until the return is due to reconstruct the occupancy history.
7. Lodge the annual return when required. Obtain advice if the occupation or rental position is unclear.
8. Notify later ownership changes. A sale, transfer or change in foreign status may create further reporting obligations.

Frequently asked questions

Is foreign investment approval the end of the process?

No. Approval addresses the proposed acquisition. Register notification and annual vacancy fee reporting are separate post-acquisition issues.

Does settlement automatically register the property for foreign investment purposes?

Buyers should not assume that title registration or conveyancing settlement automatically completes every foreign ownership reporting obligation.

Is a vacancy fee return the same as paying a vacancy fee?

No. The return is the reporting step. Whether a fee is payable depends on the property’s occupation or genuine rental availability during the applicable vacancy year.

Can personal or family use satisfy the occupancy requirement?

It depends on the actual period and nature of occupation. Occasional visits may not be sufficient.

Does listing the property online prove it was genuinely available for rent?

Not necessarily. Owners should keep evidence of the listing period, advertised rent, enquiries, applications and property availability.

What should an owner do after selling the property?

The owner should check the register notification requirements and ensure that earlier vacancy fee returns or payments have been addressed.

How Ensure Legal can assist

Ensure Legal advises foreign buyers on Queensland property contracts, conveyancing, FIRB-related conditions, foreign buyer compliance and post-settlement planning.

Early advice can help ensure that approval, settlement, ownership registration and ongoing reporting obligations are treated as one connected compliance process.

Contact Ensure Legal about a Queensland foreign buyer property transaction.