Update On The Main Residence Exemption for Expats and Non Residents

Update On The Main Residence Exemption for Expats and Non Residents

Update On The Main Residence Exemption for Australian Expats and Non Residents

 

Update On The Main Residence Exemption for Australian Expats and Non Residents – If you’re like us you would be anticipating the announcement coming out of Canberra on whether the proposed changes to the Main Residence Exemption have been passed or not.

For those that have been following our updates, we have have been keeping Australian expats up to date on the latest status of the proposed changes however what has caught our eye over the last couple of weeks has been some strange turn of events.

 

The Course of Events With The Main Residence Exemption

Let me take a step back and outline the process that has occurred and what needs to happen next:

  • 8th of February 2018 – The bill (referred to as the Treasury Laws Amendment (Reducing Pressure on Housing Affordability Measures No. 2) Bill 2018) was introduced and read for the first time in the lower house of federal parliament.
  • 14th of February 2018 – Due to the retrospective nature of the bill (that being if passed it is effective from the 9th of May 2017) it was referred to the Senate Standing Committee for the Scrutiny of Bills who commented “The committee has a long-standing concern about provisions that apply retrospectively, including provisions that back-date commencement to the date of the announcement of particular measures….”
  • 15th of February 2018 – the Senate referred the bill to the Senate Standing Committee on Economics for inquiry.
  • 1st of March 2018 – the bill was read for the second and the third time in the lower house and then passed onto the Senate
  • 23rd of March 2018 – the Senate Standing Committee on Economics delivered their report with the following comments “The committee notes that the bills will assist the government’s commitments to implement stronger rules for foreign residents owning Australian housing to reduce pressure on housing affordability…”

We provided an update on the Main Residence Exemption to Australian expats in our blog post in May that the Senate was due to meet to debate and potentially approve the new bill however as was reported in the press there was a lot of lobbying by Australian expats and the bill disappeared off the Senate Notice Paper.

This month the Senate resumed sitting on the 13th of August and in anticipation of this Atlas Wealth Management has been studying the daily releases from Canberra to see if the proposed bill appeared on the Senate Notice Paper and it did.

The bill was initially listed as Item 24 under the Government Business list and we went to work monitoring the progress of the bills before it but one thing that became apparent was that regardless of how many bills before it were passed the proposed Main Residence Exemption change bill wasn’t getting closer to being passed and in actual fact was going in the other direction in the order of business – as it stands today the bill is Item 29.

With two more days until the Senate breaks up on the 23rd of August the chances this bill will be passed this month are becoming more remote by the day. Is this delay due to lobbying in the background or is the senate not interested in prioritising this bill, we can only guess.

What we can hope for is that common sense will prevail and either an amendment to the bill will be made to make this piece of legislation fair for Australian expats or it will be scrapped altogether. Judging by the pace this this is moving through the government the above hopes maybe best presented as a request to Santa Claus because Christmas may arrive before this bill see’s the light of day.

 

Further Updates on the Main Residence Exemption

We will continue to provide an update on the Main Residence Exemption to Australian expats as the delays in gaining confirmation as to whether they have to take this bill into consideration or not is causing a lot of confusion and unwanted stress.

Australian expats are trying to make financial decisions however they can’t make them based on a proposed piece of legislation that dates back to the 9th of May 2017 which may or may not get passed in its current form.

Brett Evans is the Managing Director and a Financial Planner with Atlas Wealth Management which is the first financial services firm in Australia to specialise in providing financial advice to Australian expatriates. With over 20 years of experience in the finance and investments industry, Brett has worked for blue chip companies which include the Australian Stock Exchange (ASX), HSBC, Suncorp and Citi Smith Barney.

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