First Home Owner Grant and Shared Equity Act 2000 (NSW)

First Home Owner Grant and Shared Equity Act 2000 No 21 An Act to encourage and assist home ownership, and to offset the effect of the Goods and Services Tax on the acquisition of a first home, by establishing a scheme for the payment of grants to first home owners who purchase or build new homes; to amend the Stamp Duties Act 1920 to exempt such grants from financial institutions duty; and for other purposes. Part 1 Preliminary 1 Name of Act This Act is the First Home Owner Grant and Shared Equity Act 2000. 2 Commencement This Act commences on 1 July 2000. 3 Definitions (1) In this Act— administration of this Act or a corresponding law includes the execution and enforcement of this Act or the corresponding law. administration agreement means an agreement under section 32. Australian citizen has the same meaning as in the Australian Citizenship Act 2007 of the Commonwealth. authorised investigation—see section 34. authorised officer means a person referred to in section 33 (1) or a person appointed to be an authorised officer under section 33 (2). building includes part of a building. Chief Commissioner means the Chief Commissioner of State Revenue referred to in section 60 of the Taxation Administration Act 1996. commencement date of an eligible transaction—see section 13 (4). completed—for completion of an eligible transaction, see section 13 (5). comprehensive home building contract means a contract under which a builder undertakes to build a home on land from the inception of the building work to the point where the home is ready for occupation and if, for any reason, the work to be carried out under such a contract is not completed, includes any further contract under which the work is to be completed. consideration for an eligible transaction—see section 13 (7). corresponding law means an Act of another State, or a Territory, corresponding to this Act. eligibility cap—see section 13A. eligibility criteria means the criteria for determining whether an applicant for a first home owner grant is eligible for the grant (see Division 2 of Part 2). eligible transaction—see section 13 (1). exercise a function includes perform a duty. first home owner grant means a first home owner grant authorised under this Act. first home owner grant scheme means the scheme for payment of first home owner grants established under this Act. function includes a power, authority or duty. guardian of a person under a legal disability includes a trustee who holds property on trust for the person under an instrument of trust or by order or direction of a court or tribunal. home—see section 4. multiple occupancy contract—see section 6A. multiple occupancy land—see section 6B. new home—see section 4A. option to purchase includes a right of preemption or a right of first refusal. owner— (a) in relation to a home, has the meaning given by section 5 (1), and (b) in relation to land, means a person who has a relevant interest in the land. owner builder means an owner of land who builds a home, or has a home built, on the land without entering into a comprehensive home building contract. permanent resident means— (a) the holder of a permanent visa within the meaning of section 30 of the Migration Act 1958 of the Commonwealth, or (b) a New Zealand citizen who holds a special category visa within the meaning of section 32 of the Migration Act 1958 of the Commonwealth. property means— (a) a home, or (b) land, or (c) a relevant interest in land. relevant interest—see section 5 (2), (3) and (4). residence requirement—see section 12. residential property—land in Australia is residential property at a particular time if there is, at that time, a building on the land lawfully occupied as a place of residence or suitable for occupation as a place of residence. spouse—see section 6. taxation law means a law for the assessment or imposition of a tax. terms contract means a contract for the sale or purchase of land under which the purchaser— (a) is obliged to make 2 or more payments to the vendor after the execution of the contract and before becoming entitled to a conveyance or transfer of the land, and (b) is entitled to possession or occupation of the land before becoming entitled to a conveyance or transfer of the land. total value of a transaction—see section 13B. Note— The Interpretation Act 1987 contains definitions and other provisions that affect the interpretation and application of this Act. (2) Notes included in this Act do not form part of this Act. 4 Homes A home is a building (affixed to land) that— (a) may lawfully be used as a place of residence, and (b) is, in the Chief Commissioner's opinion, a suitable building for use as a place of residence. 4A New homes (1) A new home is a home that has not been previously occupied or sold as a place of residence, and includes a substantially renovated home and a home built to replace demolished premises. (2) A substantially renovated home is a home that— (a) has been created through renovations in which all, or substantially all, of a building is removed or replaced (whether or not the renovations involve the removal or replacement of foundations, external walls, interior supporting walls, floors or staircases), and (b) as renovated, has not been previously occupied or sold as a place of residence. (3) A home is a home built to replace demolished premises if— (a) the home has been built to replace demolished premises on the same land, and (b) the home, as built to replace the demolished premises, has not been previously occupied or sold as a place of residence, and (c) the owner of the home did not occupy the demolished premises as a place of residence before they were demolished. 5 Ownership of land and homes (1) A person is an owner of a home or a home owner if the person has a relevant interest in land on which a home is built. (2) Each of the following is, subject to subsection (3), a relevant interest in land— (a) an estate in fee simple in the land, (b) a life estate in the land approved by the Chief Commissioner, (c) a perpetual lease of the land granted by the Commonwealth or the State, (d) a leasehold interest in the land granted by the Commonwealth or the State that may be converted under the terms of the lease or by statute into an estate in fee simple, (e) an interest as purchaser under a contract for the purchase from the Commonwealth or the State of an estate in fee simple in the land by instalments, (e1) an interest as purchaser of an estate in fee simple under a terms contract, (f) a licence or right of occupancy granted by the Commonwealth or the State in relation to the land that gives, in the Chief Commissioner's opinion, the licensee or the holder of the right reasonable security of tenure, (g) an interest in a company's shares or in units in a unit trust scheme, if the Chief Commissioner is satisfied that— (i) the interest entitles the holder of the interest to exclusive occupation of a specified home situated on the land and owned by the company or trustees, and (ii) the value of the shares is not less than the value of the company's or trustees' interest in the home. (3) Subject to sections 6C and 6D— (a) an interest is not a relevant interest at a particular time unless the holder of the interest has, or will have within 12 months after that time (or a longer time allowed by the Chief Commissioner), a right to immediate occupation of the land, and (b) an interest is not a relevant interest in the hands of a person who holds it subject to a trust. (4), (5) (Repealed) (6) If a person holds an interest in land on trust as guardian for a person under a legal disability and that interest would be a relevant interest but for subsection (3) (b), then for the purposes of this Act— (a) the person under the legal disability is taken to be the person who holds a relevant interest in the land, and (b) the guardian is taken not to hold that interest. (7) In this section— unit in a unit trust scheme means— (a) a right or interest (whether described as a unit or a sub-unit or otherwise) of a beneficiary under the scheme, or (b) a right to any such right or interest. unit trust scheme means any arrangements made for the purpose, or having the effect, of providing facilities for persons participating in the arrangements, as beneficiaries under a trust, for occupying any property pursuant to the trust. 6 Spouses (1) A person is the spouse of another person if, on the commencement date of the eligible transaction— (a) they are legally married, or (b) the person is the de facto partner of the other person. Note— "De facto partner" is defined in section 21C of the Interpretation Act 1987. (2) A person to whom an applicant for a first home owner grant is legally married is not to be regarded as the applicant's spouse if the Chief Commissioner is satisfied that— (a) the applicant was not cohabiting with the person on the commencement date of the eligible transaction, and (b) at the time of deciding the application, the applicant is not cohabiting with the person and has no intention of resuming cohabitation. 6A Multiple occupancy contract (1) For the purposes of this Act— (a) a contract for the purchase of a home is a multiple occupancy contract if 2 or more homes are purchased under the contract and the homes are on the same parcel of land, and (b) a comprehensive home building contract is a multiple occupancy contract if 2 or more homes are to be built under the contract and the homes are on the same parcel of land. (2) The provisions of this Act apply in respect of a multiple occupancy contract as if a separate contract had been made in respect of each home purchased or built under the contract that is an exclusive occupancy. (3) Accordingly, each of those contracts may, subject to the requirements of section 13, be treated as a separate eligible transaction under this Act and section 7 (4) does not prevent the payment of a grant in respect of each such eligible transaction. (4) A home is an exclusive occupancy only if the Chief Commissioner is satisfied that the purchaser of the home or the party to the contract for whom the home is built is, on the completion of the contract, entitled to occupy that home as a place of residence to the exclusion of the persons who purchase the other homes, or for whom the other homes are built, under the contract. 6B Multiple occupancy land (1) For the purposes of this Act, a parcel of land is multiple occupancy land if there are 2 or more homes, built or being built, on the parcel. (2) The provisions of this Act apply in respect of the purchase or building of a home on multiple occupancy land as if the home purchased or built is an exclusive occupancy. (3) A home is an exclusive occupancy only if the Chief Commissioner is satisfied that the persons who occupy the home as a place of residence are entitled to do so to the exclusion of the persons who occupy the other home or homes on the parcel of land. 6C Building of home on land owned by another (1) If a person enters into a comprehensive building contract to build, or builds or has built, a free-standing home on land in which the person does not have a relevant interest, the provisions of this Act apply in respect of the building of the free-standing home as if the person did have such a relevant interest. (2) If a person enters into a comprehensive building contract to build, or builds or has built, at the person's own expense, an attached home on land in which the person does not have a relevant interest, the provisions of this Act apply in respect of the building of the attached home as if the person did have such a relevant interest. (3) Accordingly, a person may apply for a first home owner grant in respect of the building of such an attached home or free-standing home. (4) This section applies in respect of the building of a home only if the owner of the estate in fee simple in the land on which the home is built has consented to the occupation of the home by the applicant for the first home owner grant on completion of the home or the applicant has a right, under a lease, licence or other arrangement, to occupy the home on completion. (5) In this section— attached home means a home which includes a kitchen, a bathroom, a living area and a bedroom or a combined bedroom living area and which is part of, or connected to, a building that contains another home. free-standing home means a home that is not part of, or connected to, a building that contains another home. 6D Purchase of manufactured home (1) If a person purchases a manufactured home and intends to use it as a place of residence on land which the person has a right to occupy under a lease, licence or other arrangement but in which the person does not have a relevant interest— (a) this Act applies as if the person had a relevant interest in the land and were an owner builder building a home on the land, and (b) the commencement date of the transaction is taken to be the date of the contract to purchase the manufactured home, and (c) the transaction is taken to be completed when the manufactured home is ready for occupation as a place of residence on land that the person has a right to occupy. (2) In this section— manufactured home has the same meaning as it has in the Local Government Act 1993. Part 2 First home owner grant Division 1 Entitlement to grant 7 Entitlement to grant (1) A first home owner grant is payable on an application under this Act if— (a) the applicant or, if there are 2 or more of them, each of the applicants complies with the eligibility criteria, and (b) the transaction for which the grant is sought— (i) is an eligible transaction, and (ii) has been completed, and (c) the total value of the transaction does not exceed the eligibility cap for the type of first home owner grant that is available in respect of that transaction. (1A) (Repealed) (2) An applicant need not comply with the eligibility criteria to the extent the applicant is exempted from compliance with the eligibility criteria by this Act. (3) A first home owner grant is payable before completion of the relevant eligible transaction if payment is authorised under section 20. (4) Only one first home owner grant is payable for the same eligible transaction. Division 2 Eligibility criteria (applicants) 8 Criterion 1—Applicant to be a natural person An applicant for a first home owner grant must be a natural person. 8A Criterion 1A—Applicant to be at least 18 years of age (1) An applicant for a first home owner grant must be at least 18 years of age. (2) The Chief Commissioner may exempt an applicant from the requirement to be at least 18 years of age if the Chief Commissioner is satisfied that— (a) the home to which the application relates will be occupied by the applicant as his or her principal place of residence within 12 months after completion of the eligible transaction or a longer period approved by the Chief Commissioner, and (b) the application does not form part of a scheme to circumvent limitations on, or requirements affecting, eligibility for or entitlement to a first home owner grant. 9 Criterion 2—Applicant to be Australian citizen or permanent resident (1) Subject to subsection (2), an applicant for a first home owner grant must be an Australian citizen or a permanent resident on the commencement date of the eligible transaction. (2) If an application is made by joint applicants and at least one (but not all) of the applicants complies with the requirement to be an Australian citizen or a permanent resident, the non-complying applicant or applicants are exempted from compliance with the requirement. 10 Criterion 3—Applicant (or applicant's spouse) must not have received an earlier grant (1) Subject to subsection (2), an applicant for a first home owner grant is ineligible for the grant if— (a) the applicant or the applicant's spouse has been a party to an earlier application under this Act or a corresponding law, and (b) a grant was paid on the application. (2) An applicant is not ineligible if the grant was paid but later paid back, together with any penalty payable under section 45. 11 Criterion 4—Applicant (or applicant's spouse) must not have had relevant interest in residential property (1) An applicant for a first home owner grant is ineligible for the grant if the applicant or the applicant's spouse has, before 1 July 2000, held— (a) a relevant interest in residential property in New South Wales, or (b) an interest in residential property in another State or a Territory that is a relevant interest under the corresponding law of that State or Territory. (2) In working out for the purposes of subsection (1) whether an applicant held a relevant interest (within the meaning of this Act or a corresponding law) in residential property at a particular time, any deferment of the applicant's right of occupation (because the property was subject to a lease) is to be disregarded. (3) An applicant is also ineligible if the applicant or the applicant's spouse has, at any time before the commencement date of the eligible transaction to which the application relates— (a) held a relevant interest in residential property in New South Wales or an interest in residential property in another State or a Territory that is a relevant interest under the corresponding law of that State or Territory, and (b) occupied the property as a place of residence for a continuous period of at least 6 months. 12 Criterion 5—Residence requirement (1) An applicant for a first home owner grant must— (a) commence occupation of the home to which the application relates as the applicant's principal place of residence within 12 months after completion of the eligible transaction or the period approved by the Chief Commissioner under this section, and (b) occupy the home as a principal place of residence for a continuous period of at least 12 months or the period approved by the Chief Commissioner under this section. (2) This requirement is referred to in this Act as the residence requirement. (3) The Chief Commissioner may, if satisfied there are good reasons to do so, do either or both of the following— (a) approve the commencement of occupation by the applicant of the home to which the application relates as a principal place of residence more than 12 months after completion of the eligible transaction, (b) approve the occupation of the home as a principal place of residence for a period of less than 12 months. (4) The Chief Commissioner may, if satisfied there are good reasons to do so, exempt an applicant from the residence requirement. (5) An approval or exemption under this section may be given by the Chief Commissioner at any time, even if the period of 12 months after completion of the eligible transaction has already expired or the applicant's occupation of the home as a principal place of residence has already ceased. (6) If an application is made by joint applicants and at least one (but not all) of the applicants complies with the residence requirement, the non-complying applicant or applicants are exempted from compliance with the residence requirement. Division 3 Eligible transactions 13 Eligible transactions (1) An eligible transaction is— (a) a contract made on or after 1 October 2012 for the purchase of a new home in New South Wales, or (b) a comprehensive home building contract made on or after 1 October 2012 by the owner of land in New South Wales, or by a person who will on completion of the contract be the owner of land in New South Wales, to have a new home built on the land, or (c) the building of a new home in New South Wales by an owner builder if the building work commences on or after 1 October 2012. (2) A contract is a contract for the purchase of a home if the contract is a contract for the acquisition of a relevant interest in land on which a home is or is to be built under the contract by or on behalf of the vendor. (3) However, a contract made on or after 1 July 2000 is not an eligible transaction if— (a) in the case of a contract for the purchase of a home—the purchaser had an option to purchase the home granted before that date or the vendor had an option to require the purchaser to purchase the home granted before that date, or (b) in the case of a comprehensive home building contract—either party had a right or option granted before that date to require the other party to enter into the contract. (3A) A contract made on or after 1 October 2012 is not an eligible transaction if the Chief Commissioner is satisfied that— (a) the contract replaces a contract made before 1 October 2012, and (b) the replaced contract was a contract for the purchase of the same home or a comprehensive home building contract to build the same or a substantially similar home. Note— See also Part 11 of Schedule 1. (4) The commencement date of an eligible transaction is— (a) in the case of a contract—the date when the contract is made, or (b) in the case of the building of a home by an owner builder— (i) the date when laying the foundations for the home commences, or (ii) another date the Chief Commissioner considers appropriate in the circumstances of the case. (5) An eligible transaction is completed when— (a) in the case of a contract for the purchase of a home— (i) the purchaser becomes entitled to possession of the home under the contract, and (ii) except in the case of a terms contract, if the purchaser acquires an interest in land under the contract that is registrable under a law of the State—the purchaser's interest is registered under that law, or (b) in the case of a comprehensive home building contract—the building is ready for occupation as a place of residence, or (c) in the case of the building of a home by an owner builder—the building is ready for occupation as a place of residence. (6) If a person purchases a moveable building and intends to use it as a place of residence on land in which the person has a relevant interest but on which it is not situated at the time of purchase— (a) this Act applies as if the person were an owner builder building a home on the land, and (b) the commencement date of the transaction is taken to be the date of the contract to purchase the moveable building, and (c) the transaction is taken to be completed when the moveable building is ready for occupation as a place of residence on land in which the purchaser has a relevant interest. (7) The consideration for an eligible transaction is— (a) in the case of a contract for the purchase of a home—the consideration for the purchase, or (b) in the case of a comprehensive home building contract—the total consideration payable for the building work, or (c) in the case of the building of a home by an owner builder—the actual costs to the owner of carrying out the work (excluding any allowance for the owner builder's own labour). 13AA Types of first home owner grant that are available (1) The following types of first home owner grant are available under this Act in respect of an eligible transaction— (a) a first home builder's grant, (b) a first home purchaser's grant. (2) A first home builder's grant is available under this Act only for the following categories of eligible transaction— (a) a comprehensive home building contract, (b) the building of a home by an owner builder. (3) A first home purchaser's grant is available under this Act for any other eligible transaction. (4) Only one type of first home owner grant is available for the same eligible transaction. 13A Eligibility cap (1) The total value of the eligible transaction must not exceed the eligibility cap for the type of first home owner grant that is available under this Act for that eligible transaction. (2) The eligibility caps are as follows— (a) $750,000 for a first home builder's grant, (b) $600,000 for a first home purchaser's grant. (3) The question of whether the total value of a transaction exceeds the amount of the eligibility cap is determined by reference to the total value of the transaction as at— (a) for a contract for the purchase of a home—the commencement date, or (b) for a comprehensive home building contract—the date the transaction is completed, or (c) for the building of a home by an owner builder—the date the transaction is completed. Note— Section 20 authorises the grant to be paid before completion of an eligible transaction if the Chief Commissioner considers it appropriate. (4) The regulations may prescribe a different amount as the eligibility cap for any type of first home owner grant and may make provision for the eligible transactions to which the eligibility cap applies. (5) This section applies to the payment of a first home owner grant in respect of an eligible transaction that has a commencement date on or after 1 July 2017. Note— For eligible transactions with a commencement date before 1 July 2017, the transitional provisions in Schedule 1 apply. They preserve the previous first home owner grant cap as it applied to those transactions. 13B Calculation of total value of transaction for purposes of eligibility cap (1) For the purposes of this Act, the total value of a transaction is— (a) in the case of a contract for the purchase of a home—the greater of the following— (i) the consideration for the eligible transaction, (ii) the unencumbered value, at the commencement date, of the property the subject of the transaction, or (b) in the case of a comprehensive home building contract—the amount calculated by adding together— (i) the consideration for the eligible transaction, and (ii) the value, at the commencement date, of the relevant interest in the land on which the home is to be built, or (c) in the case of the building of a home by an owner builder—the amount calculated by adding together— (i) the unencumbered value, at the date the transaction is completed, of the home, and (ii) the value, at the date the transaction is completed, of the relevant interest in the land on which the home is built. (2) The value of the relevant interest in land on which a home is to be built is the greater of the following— (a) the consideration paid or payable for the interest, (b) the unencumbered value of the interest. (3) The unencumbered value of the property is the value of the property determined without regard to— (a) any encumbrance to which the property is subject, whether contingently or otherwise, or (b) any arrangement that results in the reduction of the value of the property, if the parties to the arrangement are not dealing with each other at arm's length, or (c) any scheme or arrangement that, in the opinion of the Chief Commissioner, was entered into, made or carried out by a party to the scheme or arrangement for the sole or dominant purpose of reducing the value of the property, or (d) if the property is held by a person on trust as guardian for another person who is under a legal disability—any liabilities of the trust, including the liability to indemnify the trustee. (4) For the purposes of subsection (3) (c), the Chief Commissioner may have regard to— (a) the duration of the scheme or arrangement before the commencement date of the transaction to which the property relates, and (b) whether there is any commercial efficacy to the making of the scheme or arrangement other than to reduce the value of the property, and (c) any other matters the Chief Commissioner considers relevant. Division 4 Application for grant 14 Application for grant (1) An application for a first home owner grant is to be made to the Chief Commissioner or a financial institution or other person with whom the Chief Commissioner has made an administration agreement. (2) An application— (a) must be in a form approved by the Chief Commissioner, and (b) must contain the information required by the Chief Commissioner. (3) An applicant must provide the Chief Commissioner with any further information the Chief Commissioner requires to decide the application. (4) Information provided by an applicant in or in relation to an application must, if the Chief Commissioner so requires, be verified by statutory declaration or supported by other evidence required by the Chief Commissioner. (5) An application may only be made within a period (the application period)— (a) commencing on the commencement date of the eligible transaction to which the application relates, and (b) ending 12 months after the completion of the eligible transaction to which the application relates. (6) However, the Chief Commissioner has a discretion to allow an application before or after the application period. (7) An applicant may, with the Chief Commissioner's consent, amend an application. 15 All interested persons to join in application (1) All interested persons must be applicants. (2) An interested person is a person who is, or will be, on the completion of the eligible transaction to which the application relates, an owner of the relevant home but does not include the following persons— (a) in a case to which section 6C or 6D applies—a person who is the owner of the estate in fee simple in the land on which the home is built or situated, (b) in the case of a home being purchased or built under a multiple occupancy contract, a purchaser of another home under the contract or party to the contract for whom another home is being built under the contract, and who does not, on the completion of the contract, acquire any entitlement to occupy the home that is the subject of the application, (c) in the case of a contract to purchase or build a home on multiple occupancy land, a person who has an exclusive occupancy of another home on the multiple occupancy land and who does not, on completion of the contract, acquire any entitlement to occupy the home that is the subject of the application, (d) the New South Wales Land and Housing Corporation, (e) a person whose ownership share in the relevant home does not exceed 5% (a small interest holder), but only if, in a case where there is more than one small interest holder, the total ownership share of all small interest holders in the relevant home does not exceed 5%, (f) in the case of a home being purchased under a contract entered into under an approve