Foreign Purchaser Additional Duty (FPAD) and Absentee Owner Surcharge (AOS) for New Zealand Citizens in Victoria

Foreign Purchaser Additional Duty (FPAD) and Absentee Owner Surcharge (AOS) for New Zealand Citizens in Victoria 

                                                                                                                                                                                      Alice He

From 26 November 2025, New Zealand citizens who are not Australian citizens or permanent residents are assessed for Foreign Purchaser Additional Duty (FPAD) and the Absentee Owner Surcharge (AOS) based on residency, rather than visa status. 

Residency Requirement 

To avoid FPAD and AOS, a New Zealand citizen must ordinarily reside in Australia for at least 6 continuous months within the 12 months before and after the property transaction. 

Australian Citizens and Residents 

FPAD and AOS do not apply to Australian citizens, permanent residents, or Australian residents. From 1 January 2026, a New Zealand citizen is no longer automatically treated as an Australian resident by holding a Special Category Visa. To be considered an Australian resident, they must: 

• Be present in Australia for 6 months or more in the year preceding the tax year, and 

• Be in Australia on 31 December of the year preceding the tax year. 

If a New Zealand citizen does not meet this test, they may be treated as an absentee owner, meaning the AOS could apply. 

What If Circumstances Change? 

If a New Zealand citizen cannot satisfy the residency requirement due to work, study, or other reasons, they must notify the State Revenue Office (SRO) within 30 days. The SRO may reassess the FPAD and AOS, but the Commissioner has discretion to adjust the residency period or allow more time if there is a valid reason. 

Seek Our Advice 

These rules can be complex, and failing to comply may result in unexpected duties or penalties. Contact us today to ensure your property transactions are structured correctly and to confirm whether FPAD or AOS applies in your circumstances. 

Alice He
January 26

Disclaimer: This publication contains comments of a general and introductory nature only and is provided as an information service. It is not intended to be relied upon as, nor is it a substitute for specific professional legal advice. You should always speak to us and obtain legal advice before taking any action relating to matters raised in this publication.