By Ethan Benedicto
Moving to Clyde North and building a home had been a big goal for the Fernando family after selling their old house in 2014.
However, while they achieved that milestone, the family had been issued land tax worth two years on their primary place of residence.
“Never in my mind, had I thought about contacting the State Revenue Office or that they were going to contact me,” Sameera Fernando, husband and father of three, said.
“Because it’s a principal place of residence (PPR), I know I don’t have to pay any land tax, there was never an intention of letting the SRO know that we lived in our home or anything.”
In the Legislative Assembly on Thursday 7 March, Berwick MP Brad Battin addressed the Treasurer on this issue and detailed that the Fernando family’s certificate of occupancy was issued on 19 March 2019, and then soon after the family moved into their home.
According to the SRO website, principal places of residence are exempt from land tax and they are made known of this with the homeowner providing the SRO with a notice of acquisition of an interest in land, or NOA.
According to Hansard, Mr Battin also added the land tax was issued since there was no person occupying the land for two years.
“I got a notice that said I owed some money, so I called the SRO and told them about the situation,” Mr Fernando said.
“They asked me all the specific details, and then when the agent finished doing her calculations on her end, she said that they could exempt us from this year and next, but for the first two years, we needed to pay.
“I was like, ‘Why is that?’ And she said that the rule was that within 12 months we needed to build, and if we were not building we needed to contact them and let them know that it is an owner-occupied property – but we didn’t know this,” Mr Fernando said.
A vacant land tax is a chargeable fee from the SRO, but only to property that is vacant for more than six months in inner and middle Melbourne, and still does not apply to one’s PPR.
It was on 10 December 2016 when the Fernando family signed a contract for land in Clyde North, the land was settled in 2018, and before the family could sign a building contract with Ranshe Homes, Mr Randolf de Silva, then-director of the company passed away.
After choosing Smarthomes as their next builder, construction began in February 2019 with the family moving in soon after.
Mr Battin, who is currently handling the situation said that “the Fernandos have complied with all the details they were provided, the government is inferring that Mr and Mrs Fernando failed to read a section of the website about applying for an exemption”.
“This request is just a way for the government not to return the money, for now, the next step is we will await the minister’s response to the other questions we have put in,” he said.
After the Fernando family attended Parliament on 20 March with Brad Battin MP, Mr Fernando recalled the Treasurer promptly telling them that they needed to pay the land tax, and that “there wasn’t an answer or anything”.
“I just want to know, what is this rile, and who should have been the one to have told us?
“I mean before buying the house there was no information and no one told us that we had to do this, so why should I pay?
“I didn’t sell it, and I can’t use the vacant lot as an investment property; I just didn’t understand, but that was the explanation that was given to me by the SRO agent,” he said.
The family never owned an investment property and had been renting after selling their original home while their current residency was being built.
“If it was my investment property by all means, I would happily pay the tax, that’s the rule and my accountant would have advised me on that, I would have gotten a bill and I would have paid it.
“But I lost money on this one because I had to pay for its mortgage and at the same time my family was renting, so why on Earth should I pay more tax?” Mr Fernando said.
The land tax was also issued on the same month their newest child was born, putting unprecedented stress on the family.
Currently, both the Fernando Family and Brad Battin MP are waiting for further updates, with hopes of further details and an amendment to the land tax.
