125 foreign real estate buyers use tax office amnesty to declare ownership

One hundred and twenty-five foreign investors have taken up an amnesty offer from the Australian Tax Office to declare their ownership of real estate, according to documents obtained by Guardian Australia from a freedom of information request.

The 125 investors have moved ahead of the deadline expiring on 30 November, the documents show.

A spokeswoman for the ATO said it had separately identified about 500 potential breaches of foreign investment laws it was investigating, a number of them from disclosures.

“Across our foreign real estate investment investigation program, we have already identified possible breaches and we have about 500 cases on hand, with about 400 of those coming from community disclosures,” she said.

“In terms of real estate, we are investigating properties located across all states and territories – while there are no specific trends, the majority of cases are related to properties in metropolitan areas.”

The ATO was unable to provide a more detailed breakdown in order to “maintain confidentiality of taxpayer information”, but there was evidence to suggest some professions involved in land purchases may be assisting in some breaches.

“In our investigations across Australia we are seeing a range of properties, from apartments, to suburban houses, to waterfront properties worth tens of millions,” she said.

“Some of these investigations are indicating the involvement of third parties. We are looking closely at agents, accountants, lawyers and financial advisers who may be facilitating illegal property purchases.”

The federal government has flagged a series of changes to foreign investment laws, which aim to improve reporting of foreign investment and increase penalties for breaches. Under foreign investment laws, foreign buyers must seek approval for certain types of real estate purchases in Australia.

The ATO will also oversee the implementation of a national register for foreign investments in agricultural, commercial and residential properties.

It has also been encouraging foreign investors who have not previously disclosed their property interests under a “reduced penalty” scheme that could allow them to avoid criminal penalties and get 12 months to divest their assets.

The documents released under freedom of information laws are the disclosures made by foreign investors of residential property across the country but have been heavily redacted.

The ATO declined to release details of the identities of those who took up the amnesty offer citing the broad secrecy laws for tax information which it said made the data “protected information”.I

The ATO also disclosed it had not yet produced a database to implement the national register.

Guardian Australia also asked for the current version of the databases used for the register of residential and agricultural land, but the ATO said the databases did not exist.

In relation to the agricultural land database a tax office freedom of information officer said: “The FIRB [Foreign Investment Review Board] team advised that they had received some information regarding relevant agricultural land purchases but the data from this information has not been incorporated into any specific database such as Excel at this stage. I am also advised that the database document is expected to be prepared within the short-term timeframe.”

A request for the residential land register produced a similar response. The ATO FOI officer wrote: “As per the government announcement, the residential land register initiative is not due to be delivered until 1 July 2016. I was also advised that given the extended lead time until its launch date there has been no commencement of the building of the database for this register.”

The ATO spokeswoman urged foreign investors to come forward before 30 November “to take advantage of reduced penalties and disclose any breaches of the rules for residential real estate purchases”.