Who counts as a foreign person
For this duty, Revenue NSW generally treats an individual as a foreign person unless one of the statuses below applies to them.
- An Australian citizen
Not a foreign person for this duty.
No surcharge - Ordinarily resident in Australia
A permanent resident, or the holder of a partner (provisional) visa (subclass 309 or 820), who has been in Australia for at least 200 days in the 12 months before the liability date, which is generally the contract date. The days you enter and leave Australia count towards the 200.
No surcharge - An exempt permanent resident
A permanent resident or partner (provisional) visa holder who is not ordinarily resident, buys as an individual (not as a trustee), and then lives in the property as their main home, without a break, for at least 200 days in the 12 months after the contract. The exemption is granted on the condition that all of this is met.
No surcharge, on conditions - A New Zealand citizen on a Special Category visa (subclass 444)
Who has been in Australia for at least 200 days in the 12 months before the liability date, or lives in the property as their main home, without a break, for at least 200 days in the 12 months after the contract.
No surcharge, on conditions - A retirement visa holder (subclass 405 or 410)
Who buys as an individual and lives in the property as their main home, without a break, for at least 200 days in the 12 months after the contract. This applies to transactions from 1 July 2019.
No surcharge, on conditions - Anyone else, including temporary and bridging visa holders
Treated as a foreign person, unless one of the statuses above applies.
Surcharge may apply
Corporations and the trustees of trusts can also be foreign persons, under their own tests. Revenue NSW explains them on its pages for corporations and trusts.
Which property it applies to
The duty applies to residential-related property, which includes residential land such as:
- A parcel of land
- With one or more dwellings on it, including dwellings under construction.
- A strata lot
- Lawfully occupied, or suitable for lawful occupation, as a separate dwelling.
- Vacant land
- Zoned or otherwise designated for residential, or principally residential, use.
- A utility lot
- Where only the owner or occupier of a strata lot may use it.
- A land use entitlement
- One that entitles the holder to occupy a building, or part of one, as a separate dwelling, such as company title.
It also covers an interest in such property, an option to purchase residential land in NSW, and certain partnership interests. Land used for primary production that is exempt from land tax is not residential land for this purpose.
How it is calculated
Like transfer duty, it is worked out on the dutiable value: the higher of the agreed purchase price and the property’s market value. Unlike transfer duty, it is a flat rate, charged as a percentage of the dutiable value at the liability date and in proportion to the share acquired by foreign persons.
Revenue NSW’s own example, at 2026/2027 rates: a foreign person buying residential property for $1 million would owe $90,000 in surcharge purchaser duty plus $39,187 in transfer duty.
Illustration, not an assessment
- Dutiable value of the home
- $1,000,000
- Share bought by a foreign person
- 50%
- Value of that share
- $500,000
- Surcharge at 9% on that share
- $45,000
As an illustration only: two people buy a home in equal shares, and one is a foreign person. The surcharge falls on the foreign person’s half; transfer duty is still charged on the purchase as usual. Arithmetic on Revenue NSW’s 9% rate and its rule that the surcharge is proportional to the foreign share.
Exemptions are narrow
Being exempt from transfer duty does not, by itself, exempt a foreign person from the surcharge. Nor does eligibility for the First Home Buyers Assistance Scheme. Revenue NSW lists exemptions for eligible build-to-rent developments and certain Australian-based developers, and for certain retirement village transfers. These are not automatic: a solicitor or conveyancer lodges an application for assessment.
The law was amended in 2026: assent was given on 29 June 2026 to the Revenue and Other Legislation Amendment Act 2026, which changed how the surcharge applies to some build-to-rent transactions and retirement village acquisitions or transfers.
When it is paid, and what you sign
It must be paid at the same time as transfer duty: by settlement, or within 3 months of signing the contract if that is earlier. Revenue NSW charges daily interest on overdue duty.
Every purchaser of residential-related property declares their foreign status to Revenue NSW on a purchaser or transferee declaration, proves their identity, and, if they are not a foreign person, proves their citizenship and residency status with certified documents. Revenue NSW recommends keeping records of the assessment, including evidence of living in the property, for at least 5 years.
Refunds
A refund may be available in some circumstances, including where the buyer’s foreign status changed so that they were no longer a foreign person on the date the property was transferred, or where the share being acquired by a foreign person was reduced.
After you own it
A foreign person who owns residential land in NSW may also owe surcharge land tax each year, at 5% of the land value with no tax-free threshold. For surcharge land tax, a permanent resident counts as a foreign person if they spend 165 days or more overseas in a calendar year (166 or more in a leap year). Land tax has its own sheet: land tax after you buy.