Insights

In brief - Foreign persons must comply with registration compliance burdens

The Federal Government's proposed changes to the Register of Foreign Ownership of Water or Agricultural Land Act 2015 have been passed which impose immediate and ongoing registration compliance burdens on foreign persons.

New laws affect foreign persons holding registrable water entitlements and contractual water rights

In our October article entitled, National register of foreign ownership of water entitlements, we advised that foreign persons who hold a "registrable water entitlement" or a "contractual water right" may need to register those interests with the Australian Taxation Office (ATO) from 1 July 2017 if the Federal Government's proposed changes to the Register of Foreign Ownership of Water or Agricultural Land Act 2015 are passed.

These changes were passed on 1 December 2016. Under the new legislation, there are: 
  • immediate compliance burdens, and 
  • ongoing compliance burdens

Immediate compliance burdens

From 1 July 2017 to 30 November 2017, "foreign persons" need to register with the ATO their "registrable water entitlement" or a "contractual water right" that they will hold at the end of 30 November 2017. 

Ongoing compliance burdens

From 1 December 2017, "foreign persons" need to notify the ATO within 30 days of the end of a financial year if:
  • they started or ceased to hold a "registrable water entitlement" or a "contractual water right" during that financial year
  • they became a "foreign person" while holding "a registrable water entitlement" or "contractual water right" during that financial year
  • they ceased to be a "foreign person" while holding "a registrable water entitlement" or "contractual water right" during that financial year
  • they held a "registrable water entitlement" or "contractual water right" where that entitlement or right to the volume of water or the share of a water resource changed

Penalties for non-compliance under the Taxation Administration Act 1953 (Cth)

Failure to meet the above registration compliance burdens will expose foreign persons to penalties under the Taxation Administration Act 1953 (Cth). At present, the penalty is 1 unit for each 28 days by which registration is delayed. At present, these units are valued at $180.

This article has been published by Colin Biggers & Paisley for information and education purposes only and is a general summary of the topic(s) presented. This article is not specific legal advice. Please seek your own legal advice for any questions you may have. All information contained in this article is subject to change. Colin Biggers & Paisley cannot be held responsible for any liability whatsoever, or for any loss howsoever arising from any reliance upon the contents of this article.​

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