Australia’s property market continues to tighten, and so does the ATO’s grip on foreign-owned investment properties. If you’re a foreign property owner — or even a permanent resident living overseas — you could be at risk of significant penalties if you miss your vacancy fee return ATO deadline.
At Endurego Tax Accounting Services, we’ve helped countless clients across Ashfield, Belrose, and the Inner West get ahead of ATO deadlines, avoid fines, and stay compliant.
🚨 ATO Cracks Down Amid Rising Interest and Housing Pressures
In 2025, the property market will have never been under more scrutiny:
- Vacancy rates are near record lows
- The RBA’s interest rate cuts are pushing up demand
- Sydney’s median house price has climbed to $1.25M
To ease housing pressure, the government is tightening vacancy enforcement, especially for foreign investors with unused or underutilised dwellings.
📌 What Is the Vacancy Fee Return?
A Vacancy Fee Return is an annual report that must be lodged with the ATO by foreign individuals who own Australian residential property, declaring how the property was used in the past 12 months.
You’ll need to disclose if the property was:
- Occupied by you or close relatives
- Rented out for 30+ day leases
- Listed and genuinely available on the market
If the property was vacant for 183 days or more, or if you fail to lodge, the ATO can impose a vacancy fee, equivalent to your original FIRB fee or more.
🛑 Do You Need to Lodge?
You must submit a Vacancy Fee Return if:
- You’re a foreign person who purchased after 9 May 2017
- You bought under a New or Near-New Dwelling Exemption Certificate
- You spent less than 183 days in Australia, even as a PR
- You failed to update your foreign investor profile
Not sure where you stand? Let our team review your FIRB status and lodging obligations.
💥 Real-World Example: The $400,000 Oversight
A client bought a Chatswood apartment in 2017 and never rented or occupied it. Eight years of missed vacancy returns led to a potential $400,000 penalty.
The ATO can:
- Place a caveat on your property
- Issue bankruptcy proceedings
- Sell the property to recover unpaid fees — even if you’re overseas
❌ “I’m a PR, So I’m Safe” — Not Always True
Even permanent residents can be classed as foreign persons under ATO rules if:
- You live overseas for more than half the year
- Your property is mostly unoccupied
- You haven’t updated your FIRB details
✔️ Can You Apply for an Exemption?
Yes, but conditions apply. Exemptions are only valid if the property was:
- Uninhabitable due to repairs or natural disasters
- Empty due to legal restrictions or health-related reasons
⚠️ You must still lodge the return to claim the exemption. No lodgement = penalty.
🧾 How to Lodge
To lodge your Vacancy Fee Return:
- Log in to the ATO’s Online Services for Foreign Investors
- Enter your Asset ID
- Lodge within 30 days of your vacancy year-end
- Pay any applicable fees or apply for exemption
Need help? At Endurego Tax, we’ve assisted clients across Northern Beaches, Ashfield, and Inner West Sydney with fast, accurate submissions.
💬 Real Clients. Real Results.
✅ A Inner West Sydney landlord avoided $150,000 in penalties after we corrected multiple non-lodgements
✅ A PR in Ashfield gained an ATO exemption for a property under renovation
✅ Several offshore clients successfully regularised overdue returns
📅 Stay Ahead for FY2025
Whether you:
- Own investment property in Sydney
- Don’t know if you need to lodge
- Missed past returns and need to catch up
Our local tax experts in Ashfield and Inner West are here to guide you. Let us take care of your tax return for FY2025, while helping you avoid costly oversights.
📞 Book Your Consultation Today
Your property is a major asset — don’t risk losing it over a missed form. Contact Endurego Tax Accounting Services for a confidential 30-minute tax consultation.
🔗 Let’s keep your ATO record clean and your investment secure..
