Recently, many NSW property owners have received letters warning that from 1 January 2026, those with less than 25% ownership could lose their Principal Place of Residence (PPR) exemption for Land Tax. This has caused confusion, as plenty of our clients hold property as tenants in common with shares below 25%.
The NSW Government’s letters did not clearly explain the details of this change — who it applies to, why it exists, or how it will be implemented. To clarify, we contacted Revenue NSW directly. Their advice was as follows (though we recommend you confirm this with Revenue NSW, as there is no publicly available detailed guidance yet):
- If you live in the property as your home: In typical cases where spouses, siblings, or other family members jointly own and reside in the property, the PPOR exemption for Land Tax will continue to apply — even if one owner holds less than 25%.
- If you are not living in the property as your home: Currently, an owner with less than 25% has been able to claim the PPOR exemption if another co-owner occupies the property as their home. From 1 January 2026, this will no longer be the case. Any unrelated owner with less than 25% ownership will lose access to the exemption.
In short, the new rule mainly affects minority owners who don’t live in the property themselves but have been benefiting from another owner’s occupation.
If you need to travel far or to another city for work and stay overnight before starting your duties, you might wonder whether these costs are deductible. The general tax rule in Australia is that travel from home to your regular place of work is considered private and not deductible, even if it involves flying long distances or staying overnight.
For example, if your employer requires you to travel at your own expense to the same city every week and then provides transport to various worksites the following day, the initial flight and overnight accommodation are still regarded as private travel. These expenses are essentially about putting you in the position to start work, not costs incurred while doing your actual job.
The ATO explains this in TR 2021/1 Income tax: when are deductions allowed for employees’ transport expenses, which gives the example of an employee who regularly flies interstate for work. Even though she stays overnight, the costs are not deductible because they are related to her personal choice of where to live compared to where she works.
That said, there are limited circumstances where travel expenses may be deductible, such as:
- Co-existing workplaces – where you genuinely have two regular places of work (for example, one near home and another interstate).
- Special demands travel – where the employer directs you to travel, pays you for the travel time, and the travel is part of the job itself (not just getting to work).
In most cases, though, if the travel is simply to get closer to your normal workplace, the costs will not be deductible.
Key takeaway: If you are flying to the same city each time and staying overnight before going to work, these travel and accommodation expenses will usually be considered private and not deductible. To be deductible, the travel must be clearly linked to carrying out your work duties—not just getting to your workplace.
We get this question a lot, and there are plenty of myths about how many months you must live in a property for it to qualify as your Principal Place of Residence (PPOR). The ATO does not actually set a minimum occupancy period on its website; instead, it considers whether the property is genuinely your home. When you occupy a property, the ATO looks for indicators such as where your family lives, the address on your electoral roll and driver’s licence, where your mail is delivered, and whether utilities are connected in your name. Based on your circumstances, even a stay of three to six months may be enough to show genuine occupancy.
Although the ATO doesn’t set a strict minimum occupancy period for your Principal Place of Residence, it does outline specific rules for cases like newly built or renovated homes, moving between residences, and applying the main residence exemption after you move out.
Newly Built or Renovated Homes
If you build or substantially renovate a home, you can treat the land as your main residence for up to 4 years before you move in, but only if you:
- Move in as soon as practicable, and
- Live there for at least 3 months.
Moving Between Homes
When you buy a new home before selling or leaving your old one, both properties can qualify as your main residence for up to 6 months, provided:
- You lived in the old home for at least 3 continuous months in the last 12 months, and
- It wasn’t used to produce income during that period.
After You Move Out
- If not rented or used for income: You can continue treating the property as your main residence indefinitely.
- If rented out: You may apply the “6-year rule” and still treat it as your main residence for up to 6 years.
Scammers are getting smarter every day when it comes to targeting Australians. They’ll try all sorts of tricks to get your personal or business details—like phone calls about fake tax debts or emails promising a surprise tax refund. To keep both you and your business safe this tax season, especially with email and SMS scams on the rise, the Australian Taxation Office suggests three simple but important precautions:
- Avoid clicking on unsolicited links or scanning QR codes in emails or texts claiming to be from the ATO. These messages may be phishing attempts designed to steal your sensitive corporate credentials.
- Always access ATO services by manually typing the URL into your browser, rather than clicking through links. This ensures you’re visiting the legitimate ATO site and not a spoofed imitation.
- Never share your Tax File Number (TFN), Australian Business Number (ABN), or login details (like myID or RAM) unless you’re absolutely sure the request is genuine and the recipient is verified. Keeping these details confidential helps protect against identity fraud.
Extra Safety Tip: If you get a suspicious call, SMS, voicemail, email, or even a social media message claiming to be from the ATO, don’t respond or engage. Remember, if you have a registered tax agent or accountant, the ATO will usually contact them first—not you directly. If someone calls saying they’re from the ATO, don’t get drawn into the conversation. Instead, hang up and call the ATO yourself on their official number to check if the contact was genuine.
Top 3 Scam Awareness Tips – ATO
You may be wondering, are financial advice fees tax-deductible in Australia? The answer is yes — but only in certain situations. The ATO allows individual taxpayers to claim deductions for some types of financial advice fees, but there are strict limits. Importantly, the fees must be paid by you personally (not through your superannuation). Below is a breakdown of which financial advice fees you can and cannot claim as a tax deduction.
- Eligible Deductions (When You Can Claim)
You may claim deductions for financial advice fees you personally pay in the following circumstances:
- Ongoing advice fees for income-producing investments — for example, regular annual or semi-annual reviews of the performance of your investments.
- Fees for advice about your existing portfolio — such as whether the mix of your income-producing investments is still appropriate and whether to keep or sell those assets.
- Fees for advice on income protection insurance products.
- The portion of advice fees that relates to managing your tax affairs — for example, advice on how tax laws apply to your personal circumstances.
These deductions are allowable only if you paid the fees yourself (not through your super fund). You must also keep evidence — such as an itemised invoice — to support your claim or to apportion deductible and non-deductible components.
- Non-Deductible Fees (When You Cannot Claim)
You cannot claim deductions for financial advice fees paid for:
- Initial advice on proposed investments (for example, setting up a new investment strategy).
- Advice on growing or restructuring your investment portfolio.
- Advice about life insurance, trauma insurance, or total and permanent disability (TPD) insurance.
- Household budgeting or other private/domestic financial matters.
- Any advice fees paid directly from your superannuation fund.
⚠️ A Note of Caution
You also need to be careful when your existing financial planner retires or sells their business to a new adviser. If the new adviser re-evaluates your portfolio and treats it as a new advisory engagement, the fee may not be tax-deductible.
Reference
Claiming financial advice fees
Cost of managing tax affairs
If you are a New Zealand citizen living in Australia on a Subclass 444 Special Category Visa, you are generally classed as a “temporary resident” for tax purposes — even though you may also be considered an Australian resident for tax purposes.
Under the ATO’s temporary resident rules, you only pay tax in Australia on your Australian-sourced income, such as:
- Salary or wages earned in Australia
- Rental income from Australian property
- Dividends from Australian shares
You do not pay tax on most foreign-sourced income or capital gains (for example, from overseas property or foreign shares), provided you:
- Hold a Subclass 444 visa, and
- Do not have an Australian citizen or permanent resident spouse/de-facto partner.
When could you lose your temporary resident status for tax purposes?
The ATO may revoke your temporary resident classification if you are in a spousal or de-facto relationship with an Australian resident or citizen.
A spouse/de-facto is defined as a person of any gender who:
- Is in a legally recognised marriage, or
- Lives with you on a genuine domestic basis as a couple.
This means if you move in with your partner and they are an Australian resident; you may become liable for tax on worldwide income.
What about overseas investments such as shares or property?
- Personally owned overseas assets: If you own overseas investments — such as foreign shares or overseas investment properties — in your own name and remain a temporary resident (Subclass 444 with no Australian spouse), capital gains from selling these assets are generally not taxable in Australia.
- Assets sold by an Australian resident trust: If an Australian resident trust sells overseas shares or an overseas property and the gain is foreign-sourced, it is generally non-assessable, non-exempt income for a temporary resident beneficiary under s 768-910 ITAA 1997. Certain exceptions may still apply, such as where the gain relates to Australian employment income or where anti-avoidance provisions are triggered.
If you have purchased a property within your Self-Managed Super Fund (SMSF) using a Limited Recourse Borrowing Arrangement (LRBA), you might be wondering whether you can carry out major renovations to enhance the property. The rules around this are strict and set out by the Australian Taxation Office (ATO) in SMSFR 2012/1 and getting them wrong can put your SMSF in breach of superannuation law.
What You Can Do with Borrowings
Under LRBA, borrowed funds can only be used for:
- Repairs – fixing damage or defects to restore the property to its original state (e.g., replacing a roof damaged by a storm, repairing fire damage to a kitchen).
- Maintenance – work that prevents deterioration and keeps the property functional (e.g., painting walls, replacing worn fences, renewing an outdated kitchen with modern equivalents).
These works are allowed because they don’t fundamentally change the character of the property.
What You Cannot Do with Borrowings
Major renovations that significantly improve or alter the property cannot be funded with LRBA borrowings. Examples include:
- Adding a second storey, new rooms, or additional bathrooms.
- Constructing a granny flat, swimming pool, or pergola.
- Converting a residential property into a commercial property or multiple strata-titled units.
Such works are classified as improvements, and LRBA rules prohibit borrowed funds from being used for improvements. Doing so could cause your SMSF to breach section 67A of the SIS Act.
How Major Renovations Can Be Done
While you can’t use borrowings for major renovations, you may proceed if:
- You fund the renovations using SMSF’s own cash resources (contributions or accumulated earnings).
- The renovations don’t transform the property into a different asset type (e.g., it must remain residential if originally purchased as residential).
- It doesn’t result in a different asset being held (for example, converting a house into a block of units would breach LRBA rules).
Inheriting a property overseas does not automatically trigger a tax liability in Australia. Generally, there is no tax payable at the time of inheritance. However, if you later sell the inherited property, you may be subject to Capital Gains Tax (CGT) in Australia—regardless of where the property is located—because Australian tax residents are taxed on their worldwide income and capital gains.
The capital gain is typically calculated based on the market value of the property at the date of inheritance. If you sell the property for more than this value, the gain must be reported in your Australian tax return.
If you hold the inherited property for more than 12 months before selling it, you may be eligible for the 50% CGT discount, which can significantly reduce your taxable capital gain. This discount is available to Australian tax residents for assets held longer than one year, including foreign real estate.
It’s important to note that while some countries impose inheritance or estate taxes, these are generally not creditable against your Australian CGT liability unless they are directly related to capital gains. Each situation can vary depending on the local laws of the country where the property is located and whether any double taxation agreements apply.
Due to the complexity of international estate and tax laws, it’s strongly recommended that you seek professional advice to ensure you’re meeting your obligations and making the most of any tax concessions available.
No, the 6-year Capital Gains Tax (CGT) exemption does not apply if you only rent out part of your home—such as a single bedroom—while continuing to live there. In this case, the property remains your main residence, but CGT is calculated on an apportioned basis. For example, if you rent out one-fifth of your property for two years, you may be liable for CGT on one-fifth of the capital gain related to that two-year period when the property is eventually sold.
To qualify for the full 6-year CGT exemption, you must move out and rent out the entire property while treating it as your main residence for tax purposes.
Land Tax:
Generally, no land tax is payable if you’re only renting out part of your principal place of residence (PPOR). The property is still considered your home. However, if you rent out the entire property, it may lose its exemption status and become subject to land tax, depending on the state or territory regulations.
Income Tax Reporting:
Any rental income received—whether from one room or the whole property—must be declared in your tax return. You can also claim a proportion of the related expenses, such as mortgage interest, council rates, insurance, and utilities, based on the area rented out and the period of rental.