Foreign Vic property investor fined $250k

Foreign Vic property investor fined $250k

Foreign Vic property investor fined $250k

A foreign investor who bought up real estate in Melbourne without approval has been ordered to pay $250,000, in a Federal Court first.

A man has become the first person fined by Australia's Federal Court for breaching the nation's foreign investor laws.

The court ordered Vijay Balasubramaniyan pay $250,000 to the federal government as well as the Tax Commissioner's legal costs, after failing to notify authorities of his stake in four Melbourne properties.

The foreign investor admitted buying into the Hoppers Crossing, Werribee and Aintree properties from 2016 to 2018 without giving notice to Foreign Investment Review Board, as required under the Foreign Acquisitions and Takeover Act 1975.

Mr Balasubramaniyan, who moved to Australia on a temporary visa in 2015 before marrying his Australian wife in 2017, also simultaneously jointly owned two established properties at once in another two breaches.

Under the FATA, foreign investors are limited in the type of residential property they can purchase in Australia and must apply before doing so.

In his reasons, Justice Jonathan Beach said Mr Balasubramaniyan banked $710,300 in capital gains from his illegal purchases and general deterrence factored into the sizeable fine.

It is the first penalty order issued by the Federal Court for FATA breaches, and Australian Taxation Office Assistant Commissioner Keir Cornish said it would serve as a clear deterrent to other foreign investors who flout the law.

"There are obligations under Australian law for foreigners that have invested in, or plan to invest in Australian residential real estate," Mr Cornish said in a statement on Monday.

"The ATO promotes voluntary compliance of the rules by foreign persons, but where foreign investors resist compliance action, stronger enforcement action is taken."

The four Melbourne properties have since been sold, putting them back on the market for Australian residents.

From 2015 to 2021, 434 residential properties in Australia have been disposed of as a result of foreign investor compliance action.

Source:https://7news.com.au/news/crime/foreign-vic-property-investor-fined-250k-c-6411007

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