Liu v Chief Commissioner of State Revenue

[2025] NSWCATAD 141

Civil and Administrative Tribunal

New South Wales

Medium Neutral Citation:

Liu v Chief Commissioner of State Revenue [2025] NSWCATAD 141

Hearing dates:

13 May 2025

Date of orders:

16 June 2025

Decision date:

16 June 2025

Jurisdiction:

Administrative and Equal Opportunity Division

Before:

J Sullivan, Senior Member

Decision:

The assessment to surcharge purchaser duty, interest and penalties is confirmed.

Catchwords:

TAXATION AND REVENUE – surcharge purchaser duty – whether the Applicant was a “foreign person” – whether the Applicant met the requirements for the exemption under s 104ZKA of the Duties Act 1997 (NSW)

TAXATION AND REVENUE – interest and penalties

Legislation Cited:

Administrative Decisions Review Act 1997 (NSW)

Civil and Administrative Tribunal Act 2013 (NSW)

Duties Act 1997 (NSW)

Foreign Acquisitions and Takeovers Act 1975 (Cth)

Taxation Administration Act 1996 (NSW)

Treasury and Revenue Legislation Amendment Act 2023 (NSW)

Cases Cited:

Chief Commissioner of State Revenue v Downer EDI Engineering Pty Ltd [2020] NSWCA 126

Chief Commissioner of State Revenue v Incise Technologies Pty Ltd & Anor (RD) [2004] NSWADTAP 19

Chu v Chief Commissioner of State Revenue [2021] NSWCATAD 238

Cornish Investments Pty Ltd v Chief Commissioner of State Revenue (RD) [2013] NSWADTAP 25

Feng v Chief Commissioner of State Revenue [2024] NSWCATAD 155 (Feng)

Gao v Chief Commissioner of State Revenue [2020] NSWCATAD 216

Ghali v Chief Commissioner of State Revenue [2013] NSWCA 340

Golden Age and Hannas the Rocks Pty Ltd v Chief Commissioner of State Revenue [2024] NSWSC 249

Lawrence v Chief Commissioner of State Revenue [2022] NSWCATAD 266

Nguyen v Chief Commissioner of State Revenue [2022] NSWCATAD 354

Wan v Chief Commissioner of State Revenue [2025] NSWCATAP 54

Texts Cited:

None

Category:

Principal judgment

Parties:

Yue Liu (Applicant)
Chief Commissioner of State Revenue (Respondent)

Representation:

Self-Represented (Applicant)

Solicitors
Crown Solicitor (Respondent)

File Number(s):

2024/00250207

Publication restriction:

None

REASONS FOR DECISION

1. The Applicant is Ms Yue Liu. She has asked the Tribunal to review an assessment to surcharge purchaser duty (“SPD”).

2. The central issue is whether the Applicant was liable to pay SPD under the relevant provisions of the Duties Act 1997 (NSW) (“Duties Act”).

3. If she is liable, the Tribunal must also consider interest and penalties, and whether there is any reason to remit them in whole or in part.

Jurisdiction and Onus of Proof

4. The Applicant objected to the assessment, but the objection was disallowed. Accordingly, the Tribunal has jurisdiction to hear this matter: s 96 of the Taxation Administration Act 1996 (NSW) (“TA Act”), s 9 of the Administrative Decisions Review Act 1997 (NSW) (“ADR Act”) and s 30 of the Civil and Administrative Tribunal Act 2013 (NSW) (“NCAT Act”).

5. The Tribunal’s task is to decide what the correct and preferable decision is having regard to the material before it at the time of the hearing: ADR Act, s 63(1).

6. The applicant bears the onus of proof: TA Act, s 100(3). That means she must prove all matters necessary for the Tribunal to answer the statutory questions in her favour: Cornish Investments Pty Ltd v Chief Commissioner of State Revenue (RD) [2013] NSWADTAP 25 at [36]. The standard of proof is the balance of probabilities.

Relevant legislation

Surcharge Purchaser Duty

7. SPD is imposed under Chapter 2A of the Duties Act.

8. SPD is chargeable on a transfer or an agreement for sale or transfer of residential-related property to a foreign person: Duties Act, s 104L. Residential-related property includes residential land in NSW: Duties Act, s 104K(a).

9. A “foreign person” is a person who is a foreign person within the meaning of the Foreign Acquisitions and Takeovers Act 1975 (Cth) (“FATA”): Duties Act, s 104J.

10. Section 4 of the FATA defines a foreign person as an individual who is not ordinarily resident in Australia. Section 5(1) of the FATA provides that an individual who is not an Australian citizen is ordinarily resident in Australia at a particular time if and only if:

(a) the individual has actually been in Australia during 200 or more days in the period of 12 months immediately preceding that time; and

(b) at that time –

(i) the individual is in Australia and the individual’s continued presence in Australia is not subject to any limitation as to time imposed by law, or

(ii) the individual is not in Australia but, immediately before the individual’s most recent departure from Australia, the individual’s continued presence in Australia was not subject to any limitation as to time imposed by law.

11. Section 104J(3) of the Duties Act provides that for the purposes of charging SPD on a surcharge duty transaction, a person is taken to be a foreign person if the person is a foreign person when a liability for duty charged by Chapter 2 on the transaction arises.

12. Relevantly, under ss 104Q and 12(2) of the Duties Act, where a transfer of dutiable property is effected by an instrument, the liability for duty arises when the instrument is first executed. So, in respect of a transfer of real property under a contract, the date of signing the contract is the relevant “liability date”, not the date of settlement.

13. Section 104W of the Duties Act provides that a tax default occurs for the purpose of the TA Act if the duty is not paid within three (3) months after the liability to pay the duty arises.

14. Relevantly, there is an exemption from SPD if the requirements of s 104ZKA of the Duties Act are satisfied. That section provides as follows:

104ZKA   Exemption for certain permanent residents in respect of principal place of residence

(1)  No surcharge purchaser duty is chargeable on a transfer, or an agreement for the sale or transfer, of residential-related property if each transferee under the transfer or agreement who would otherwise be liable to pay that duty is an exempt permanent resident.

(2)  A transferee under a transfer or agreement is an exempt permanent resident if—

(a)  the transferee is a permanent resident when a liability for duty charged by Chapter 2 on the transfer or agreement arises (or would arise but for a concession or exemption from duty under that Chapter), and

(b)  the Chief Commissioner is satisfied that the transferee intends to use and occupy the residential land to which the residential-related property relates as a principal place of residence in accordance with the residence requirement.

(3)  If there is more than one transferee under the transfer or agreement who is a foreign person (a foreign transferee) and the Chief Commissioner is satisfied that at least one, but not all, of those transferees is an exempt permanent resident—

(a)  surcharge purchaser duty is to be reduced in proportion to the share or shares in the residential-related property transferred to foreign transferees who are exempt permanent residents, and

(b)  none of those exempt permanent residents is liable to pay surcharge purchaser duty on the transfer or agreement.

(4)  The residential land must be used and occupied by the exempt permanent resident as his or her principal place of residence for a continuous period of at least 200 days within the first 12 months after the liability date. This requirement is referred to as the residence requirement.

(5)  The liability date is the date on which liability to surcharge purchaser duty first arose in respect of the share in the residential-related property transferred, or agreed to be transferred, to the exempt permanent resident.

(6)  If the residence requirement is not complied with in relation to the residential land, the Chief Commissioner must assess or reassess the surcharge purchaser duty chargeable on the transfer or agreement as if the exemption under this section had never applied.

(7)  A reference in this section to the use and occupation of residential land as a principal place of residence in accordance with the residence requirement includes—

(a)  in the case of a land use entitlement, a reference to the use and occupation of the building or part of the building to which the entitlement relates, as a principal place of residence in accordance with the residence requirement, and

(b)  in the case of a utility lot (within the meaning of the Strata Schemes Management Act 2015), a reference to the use of the utility lot in conjunction with a strata lot used and occupied as a principal place of residence in accordance with the residence requirement.

Interest

15. A failure by a taxpayer to pay, in accordance with a taxation law, the whole or part of tax that the taxpayer is liable to pay is called a tax default: TA Act, s 3(1).

16. If a tax default occurs, the taxpayer is liable to pay interest on the amount of tax unpaid, calculated on a daily basis: TA Act, s 21(1).

17. The interest rate is the sum of the market rate component, and the premium component: TA Act, s 22(1).

18. Section 25 of the TA Act provides for the remission of interest.

1. Commencing from 1 February 2024, s 25 was amended by the Treasury and Revenue Legislation Amendment Act 2023 No 26 (NSW) to provide as follows:

25   Remission of Interest

(1)    The Chief Commissioner may remit interest.

(2)   The Chief Commissioner may issue guidelines setting out how interest must be remitted under this division.

(3)   If guidelines are issued, interest must be remitted only in accordance with the guidelines.

(4)   The imposition or remission of penalty tax is not relevant to the imposition or remission of interest.

2. Prior to that amendment, s 25 provided:

25   Remission of interest

The Chief Commissioner may, in such circumstances as the Chief Commissioner considers appropriate, remit the market rate component or the premium component of interest, or both, by any amount.

19. The Respondent confirmed that no guidelines have been issued under the new s 25(2).

Penalty tax

20. Sections 26 and 27 of the TA Act provide for the imposition of penalties for a tax default:

26   Penalty tax in respect of certain tax defaults

(1)  If a tax default occurs, the taxpayer is liable to pay penalty tax in addition to the amount of tax unpaid.

(2)  Penalty tax imposed under this Division is in addition to interest.

(3)  Penalty tax is not payable in respect of a tax default that consists of a failure to pay—

(a)  interest under Division 1, or

(b)  penalty tax previously imposed under this Division.

27   Amount of penalty tax

(1)  The amount of penalty payable for a tax default is, subject to this Division—

(a)  25% of the amount of tax unpaid, or

(b)  if the taxpayer is a significant global entity within the meaning of the Income Tax Assessment Act 1997 of the Commonwealth—50% of the amount of tax unpaid.

(2)  The Chief Commissioner may increase the amount of penalty tax payable in respect of a tax default to 75% of the amount of tax unpaid if the Chief Commissioner is satisfied that the tax default was caused wholly or partly by the intentional disregard by the taxpayer (or a person acting on behalf of the taxpayer) of a taxation law.

(3)  The Chief Commissioner may determine that no penalty tax is payable in respect of a tax default if the Chief Commissioner is satisfied that—

(a)  the taxpayer (or a person acting on behalf of the taxpayer) took reasonable care to comply with the taxation law, or

(b)  the tax default occurred solely because of circumstances beyond the taxpayer’s control (or if a person acted on behalf of the taxpayer, because of circumstances beyond either the person’s or the taxpayer’s control) but not amounting to financial incapacity.

21. Section 29(1) of the TA Act provides for a 20% reduction as follows:

(1) The amount of penalty tax determined under section 27 is to be reduced by 20% if, after the Chief Commissioner informs the taxpayer that an investigation relating to the taxpayer is to be carried out and before it is completed, the taxpayer discloses to the Chief Commissioner, in writing, sufficient information to enable the nature and extent of the tax default to be determined.

22. There is also a discretion to remit penalty tax under s 33 of the TA Act:

1. Commencing from 1 February 2024, s 33 was amended by the Amendment Act to provide as follows:

33   Remission of penalty tax

(1)    The Chief Commissioner may, in such circumstances as the Chief Commissioner considers appropriate, remit penalty tax by any amount.

(2)   The imposition or remission of interest is not relevant to the imposition or remission of penalty tax.

2. Prior to that amendment, s 33 provided:

33   Remission of penalty tax

The Chief Commissioner may, in such circumstances as the Chief Commissioner considers appropriate, remit penalty tax by any amount.

Materials before the Tribunal

23. All of the materials were conveniently included in an indexed Tribunal Book (“TB”) provided by the Respondent. This included the Applicant’s application to the Tribunal, documents filed by the Respondent under s 58 of the ADR Act, as well as written submissions (and accompanying documents) filed by the parties.

24. A further document was produced at the hearing by the Respondent and accepted into evidence as “R2”. This was the “Purchaser/Transferee Declaration – Explanatory Notes and Supporting Evidence” issued by the Respondent as at June 2019 (the relevant version issued at the time relevant to these proceedings). I will refer to this document as the “Explanatory Notes”.

The facts

25. The Applicant is a Chinese citizen. She is not an Australian citizen.

26. At all relevant times, she was an Australian permanent resident. She held a subclass BB/155 visa.

27. The Applicant had been living in Australia for many years, but also spent time overseas. She calculated from her movement records that she was present in Australia for more than 200 days in every calendar year except the 2020 calendar year where she was present in Australia for only 90 days (TB 29).

28. Relevantly, during the 2019 and 2020 years, she (TB 31-32):

1. flew out of Australia on 9 September 2019, and returned on 6 November 2019; and

2. flew out of Australia on 15 January 2020, and returned on 18 October 2020.

29. Regarding the second absence from Australia, the Applicant said she intended to return to Australia in March 2020, but could not return due to the COVID-19 pandemic. There was a ticket receipt in evidence (TB 17) confirming she had booked flights to return to Sydney from Tianjin (via Seoul) on Monday 16 March 2020.

30. The Respondent does not dispute that she was prevented from returning to Australia earlier due to restrictions on flights and international travel, and other lockdowns in Australia and China.

Purchase of the property

31. The Applicant gave oral testimony under oath during the hearing, but had not provided a written statement. She confirmed that she was in China when she entered into the “off the plan” contract to buy the property, which was vacant land upon which a house was going to be built. She confirmed that she used KWL Lawyers as her lawyers for the purchase and associated legal matters.

32. There was no complete contract before the Tribunal. Documents (at TB 95-102) revealed only some initial pages of the contract (unsigned by the Applicant), together with an unsigned “Disclosure Statement – Off the Plan Contracts”. The latter document suggested that a Development Approval had been obtained with a reference “JRPP-16- 03316 (as amended from time to time)”, but there were no further details.

The Purchaser/Transferee declaration

33. The Applicant confirmed that she had signed the Purchaser/Transferee Declaration dated 18 September 2020 (“Declaration”, at TB 91-94), and that she was therefore in China when she had signed and returned it to her solicitor. She could not recall how and when it was signed in any further detail, nor the witness (whose name and signature was on the Declaration), nor what if any advice was received in relation to it. She thought she just received it from the solicitor, who asked her to sign it and return it. (There was no evidence filed by the Applicant from the solicitor and, if there had been, the Respondent told the Tribunal they would have sought to question them.)

34. As noted by the Respondent, the following details are observed from the Declaration:

1. It stated, under “Note” on page 1 (TB91) (inter alia):   

“Before completing this declaration, each purchaser/transferee must read the information about the Surcharge Purchaser Duty and Surcharge land Tax and Purchaser/Transferee Declaration – Explanatory Notes and Supporting Evidence available at start="2">

She confirmed she was a citizen of China, and included her visa details;

She answered “No” to the question “Is the purchaser/transferee a foreign person” and advised (by ticking the box) that she met the category of a person who is ordinarily resident in Australia (including a New Zealand citizen as per explanatory notes).

She therefore did not complete the following question:

“If yes, is the purchaser/transferee a permanent resident… who will occupy the property as their principal place of residence for a continuous period of 200 days within the first 12 months after the liability date (date of agreement)?”

5. She stated the sale was an “off the plan purchase”; and answered
   “yes” to the question:

“If off the plan, will the purchaser/transferee occupy this property as their principal place of residence for a continuous period of at least 6 months, commencing within 12 months from the date of settlement?”

6. She declared, at part C of the Declaration, that all the information disclosed was true and correct and by virtue of the provisions of the Oaths Act 1900.

35. The Explanatory Notes to the Declaration (R2) stated, inter alia:

You are not a foreign person if you are:

(a)   an Australian citizen

(b)    a person who is ordinarily resident in Australia.

Ordinarily resident in Australia means:

(a)   the person has actually been in Australia during 200 or more days in the period of 12 months immediately preceding the date of the agreement; and

(b)   was not subject to any limitation as to time for their continued presence in Australia (or was not, immediately before their most recent departure from Australia).

Electronic processing of the contract

36. The Applicant’s lawyer attended to the electronic processing of the contract (TB 207ff) which was lodged on 18 December 2020. It disclosed that the foreign interest was 0%; and it was completed on the basis that the Applicant was a citizen of China, and said “yes” to the question “Is the person ordinarily resident in Australia or a New Zealand citizen?”.

37. On the basis of those responses, substantive duty was therefore assessed for $911.75 (TB 211). In other words, no SPD was assessed at that time.

Transfer of the property

38. The transfer document issued by Land and Property Information NSW (TB 51) revealed:

1. the property address and details;

2. the contract date of 16 September 2020;

3. the settlement date of 22 December 2020;

4. the Applicant registered on 22 December 2020 as the sole owner; and

5. KWL Lawyers as the transferee’s solicitor/agent.

Completion of the House

39. A Corelogic document before the Tribunal said that a DA for a house/single dwelling was submitted in “May 2021” and the “permit date” was 31 May 2021. In any event, it was not in dispute that the construction was completed in November 2022, with an occupation certificate being issued for a two storey dwelling on 10 November 2022 (TB 23 and 199).

40. The Applicant told the Respondent “I moved in the house in 2023” (TB 122).

The investigation

41. On 27 February 2024, the Respondent issued a notice of investigation to the Applicant (TB 104). It was also emailed to her on 5 March 2024 (TB 103).

42. KWL Lawyers responded on 8 March 2024 and an extension of time to respond was granted (TB 109). The response, when provided, included the transfer form, contract extracts and Declaration noted above.

43. On 3 April 2024, the Respondent issued the assessment together with a cover letter (TB 187-190). The assessment detailed SPD of $32,400, penalty tax of $6,480 and interest (at market and premium rates) of $10,383.77.

41. The Applicant objected on 11 April 2024 (TB 196), but the objection was disallowed on 9 May 2024 (TB 205).

Was the Applicant liable to SPD?

Applicant’s submissions

45. The Applicant was self-represented, and communicated with the Tribunal via an interpreter. She had provided some brief submissions, and explained to the Tribunal her key points which were as follows:

1. The Respondent said that she didn’t live in Australia for 200 days before the contract date. But there were objective reasons why she wasn’t able to come back. That was due to COVID-19 happening and China being in lockdown.

2. The airline ticket to return was, as noted, before the Tribunal.

3. She asks the Tribunal to take her circumstances into account to fulfil her requirements. The airlines only allowed 30 people on any flight. It was very difficult to travel. It was because of those circumstances that the 200 day test was not met.

46. The Tribunal asked her what advice she received from her lawyers. She responded that the lawyer didn’t provide her any advice, and didn’t tell her anything. As noted above, the Respondent raised an objection that there was no evidence regarding advice from her lawyer and, if it had been put in evidence, they would have summonsed the solicitor to allow for them to be cross-examined.

47. The Applicant said “this was the only period of time I didn’t fulfil the 200 day requirement”. This fact is accepted by the Respondent. But she wished to emphasise that this was a one-off event that she did not control.

48. She did not make separate submissions in respect of interest and penalties, but I took her submissions to be made in respect of all of the matters I am required to consider.

Respondent’s submissions

49. The Respondent submitted that there were two elements regarding the Applicant’s liability to the substantive duty (i.e. her liability to SPD).

50. The first was whether she was a “foreign person”.

51. The second was whether any exemption applied; specially, the principal place of residence exemption.

52. In respect of the first matter, the Respondent said that:

1. The Applicant was a permanent resident but was not in Australia for the required period of 200 days in the 12 month period prior to the contract date of 16 September 2020. By the Respondent’s calculation, she was physically present for a period of 71 days in that period.

2. Accordingly, she was a “foreign person” for the purpose of the definition in s 4 of the FATA.

3. It was accepted that she had a good reason, but the reasons are not relevant, because factually she did not meet the requirements to not be a foreign person, and there was no discretion: see Lawrence v Chief Commissioner of State Revenue [2022] NSWCATAD 266 (Lawrence), Chu v Chief Commissioner of State Revenue [2021] NSWCATAD 238 (Chu).

53. In respect of the second matter, the only relevant exemption was under s 104ZKA of the Duties Act, and the Applicant could not meet the requirements for that exemption because she did not live there at any time prior to 2023 (by her own admission) and in any event the occupation certificate was only issued on 10 November 2022. The Respondent pointed to similar cases considered by the Tribunal including Nguyen v Chief Commissioner of State Revenue [2022] NSWCATAD 354 (Nguyen) and Feng v Chief Commissioner of State Revenue [2024] NSWCATAD 155 (Feng).

Consideration

54. I agree with the submissions of the Respondent that the Applicant is liable for SPD as assessed.

55. First, I find that she was a foreign person at the liability time, being 16 September 2020 (the contract date) for the following reasons:

1. She was not an Australian citizen or a New Zealand citizen. Therefore the test is considered solely under the FATA, because the modifications in s 104J(2) of the Duties Act do not apply.

2. It was necessary to meet both of the tests of “ordinarily resident” in s 5(1)(a) and (b) of the FATA. And she did not meet the requirement in s 5(1)(a) of the FATA because she had not actually been in Australia during 200 or more days in the period of 12 months immediately preceding the contract date. The words “has actually been in Australia” in s 5 of the FATA require physical presence in Australia: Gao v Chief Commissioner of State Revenue [2020] NSWCATAD 216 at [50].

3. She was therefore not “ordinarily resident” in Australia at the particular time (16 September 2020).

4. She was therefore an individual not ordinarily resident in Australia, and a foreign person as defined in the FATA (s 5, definition of “foreign person” under paragraph (a)).

5. She was therefore a foreign person for the purpose of Chapter 2A of the Duties Act (per s 104J(1)).

6. Accordingly, unless an exemption applies, she is liable to SPD under s 104L(1) of the Duties Act.

56. The reasons for the failure to meet the 200 day requirement are not, unfortunately, of any relevance. She did not satisfy the requirement, and the legislation does not provide any relief for any person who fails the test: see Lawrence at [38], Chu at [30], Feng at [32].

57. Second, I find that she is not within the exemption in s 104ZKA of the Duties Act.

1. As a permanent resident when the liability for duty arose, the exemption applies if the Chief Commissioner (and, here, the Tribunal) is satisfied that the applicant intends to use and occupy the residential land as a principal place of residence in accordance with the residence requirement.

2. The residence requirement is that the residential land must be used and occupied by the applicant as her principal; place of residence for a continuous period of at least 200 days within the first 12 months after the liability date: s 104ZKA(4).

58. There is no scope in s 104ZKA to either extend or waive the residence requirement because of delays caused by COVID-019 or for any other reasons: Feng at [39]-[40] citing Ghali v Chief Commissioner of State Revenue [2013] NSWCA 340 at [24] ff; see also Nguyen at [41].

59. I therefore find that the residence requirement was not satisfied, and no principal place of residence exemption applies under s 104ZKA of the Duties Act.

60. The correct and preferable decision is that the Applicant was liable to SPD as assessed.

Interest and Penalties

61. The Applicant sought remission of penalties and interest.

62. The relevant provisions in the TA Act relating to penalties and interest are set out above. I have had regard to the Respondent’s guidance in practice note CPN 024 and to the various authorities regarding these provisions and the basis upon which interest and penalties may be remitted, including Chief Commissioner of State Revenue v Incise Technologies Pty Ltd & Anor (RD) [2004] NSWADTAP 19, Golden Age and Hannas the Rocks Pty Ltd v Chief Commissioner of State Revenue [2024] NSWSC 249, Wan v Chief Commissioner of State Revenue [2025] NSWCATAP 54 and Chief Commissioner of State Revenue v Downer EDI Engineering Pty Ltd  [2020] NSWCA 126.

63. The relevant principles are not in dispute, and each case depends on its own facts. Importantly, the onus of proof falls on the Applicant under s 100(3) of the TA Act to prove those facts.

64. The relevant facts as found are that the Applicant engaged a solicitor, the solicitor sent the documentation to the Applicant to be completed, the Applicant signed and returned the documents, incorrectly stating in the Declaration that she was “ordinarily resident in Australia” and therefore not a “foreign person”, and she did not – apparently - ask questions of her solicitor to confirm whether that was correct. Nor did she say that she read the Explanatory Notes as she was instructed to do in the Declaration itself.

65. It is clear that the Applicant said that she relied on her solicitor to bring any matters to her attention. But there was no evidence regarding the conversations held, or written communications, nor (as submitted by the Respondent) was there any evidence directly from the solicitor. The Tribunal is therefore unable to test what transpired or what, if anything, was discussed. In those circumstances, it is not the Tribunal’s role to conclude on what it thinks may have occurred.

66. The Applicant argues that the Respondent issued an original assessment which did not include any liability to SPD, and has now changed his position. But that ignores the fact that the Declaration, and resulting lodgement by her solicitor, was incorrect. It was a self-assessment system, and there was no duty on the Respondent to query what had been submitted, notwithstanding his later enquiries through his general audit activities.

67. The Respondent also noted that this case contained the following additional facts:

1. On 16 September 2020, the Applicant was aware that she was not in Australia.

2. By 18 September 2020 when the Declaration was lodged, she was also aware that she had not been Australia since January of that year.

3. There is no evidence that she read the explanatory notes for the Declaration, which contained the definition of “foreign person” and the requirement stated as “the person has actually been in Australia” for 200 or more days in the period of 12 months immediately preceding the contract date.

68. I also observe that the objection lodged by her lawyers on 11 April 2024 was an email which said (my emphasis):

“We refer to the above matter and represent Ms Yue Liu.

We also refer to the final Investigation Letter (File Reference: CM/24/396) and are instructed to object the decision.

We are instructed that the purchase for [Property address] was settled on 22 December 2020 as vacant land. The house was not built until 10 November 2022 (see final Occupation Certificate attached). Our client has since resided in [Property] from 10 November 2022 to now.

We therefore request Revenue NSW to re-assess this case on the basis that our client has satisfied the residency requirement that she has lived in the property for a period of 200 days.”

69. However, as noted above, the residency test did not simply require the Applicant to live in the property for a period of 200 days. In addition, that period had to commence within 12 months of the date of the agreement. There appears to have been some confusion regarding the DA lodgments, but the hearing proceeded on the basis that the DA for construction of the home was lodged on 31 May 2021, a matter not disputed by the Applicant . That date was after 28 February 2021, which was the last day that the 200 day occupation as her residence could have started, such as to satisfy the residence requirement in s 104ZKA of the Duties Act. Similarly, the documents produced relating to the “delay in construction” caused by COVID-19 also post-dated that date; the documents from the builder referred to a halt in building caused by COVID-19 lockdowns for a period of 2 weeks from 19 July 2021 until 30 July 2021 (TB 21).

70. I have had regard to the circumstances of the Applicant and have sympathy for her current predicament. However, I must also have regard to the onus of proving the facts necessary to support the level of satisfaction necessary to warrant a reduction of penalties and interest in whole or in part under the provisions of the TA Act. And the above facts lead me to the following conclusions in respect of interest and penalties.

1. I cannot be satisfied that there are exceptional circumstances or circumstances caused solely by the Respondent that led to the tax default;

2. Having regard to the Applicant’s testimony, and in the absence of evidence from the solicitor, I cannot be satisfied that either the Applicant or her solicitor took reasonable care; and

3. The Applicant has not proved, to my satisfaction, any other matters or personal circumstances that would cause me to exercise the discretion to otherwise reduce the premium or market rate of interest (under s 25 of the TA Act) or to reduce penalty tax (under s 33 of the TA Act).

71. In those circumstances, the correct and preferable decision is that the Applicant was liable to interest and penalties as assessed.

Order

72. I make the following order:

1. The assessment to surcharge purchaser duty, interest and penalties is affirmed.

I hereby certify that this is a true and accurate record of the reasons for decision of the Civil and Administrative Tribunal of New South Wales.

Registrar

Decision last updated: 16 June 2025