Unjustified $45000 LAND TAX on Land I bought as a future Principal Place of Residence-PPOR

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REVENUE NSW - 4 Year LAND TAX Exemption Clause to build on Land to be used as a Principal Place of Residence(PPOR). Complete your build in 4 years and if not for some reason, PAY for all the 4 YEARS..............

Unjustified imposition of Land Tax of $45,000 for Land which was bought as a future Principal Place of Residence (PPOR) and on which now a Family Residence has been constructed (Occupancy Certificate granted in December 2019) :--

I was a resident of Glenmore Park, NSW till 2014 and my 14 year old son was travelling daily to a High School in North Sydney, NSW, a  journey on Public Transport, which took him more than 2 hours each way. To make life a bit easy for him, we found a battle-axe land parcel in Lane Cove West and in 2013, we thought that before his HSC, we will be able to make life comfortable for him and the House - our Future PPOR will be complete by that time. Told Revenue NSW about the Purchase and mentioned that this will be our Future PPOR. Sold our Glenmore Park House in 2014 and again informed Revenue NSW and they gave a 4 year exemption from Land Tax. At the time, we believed that 4 years would be enough. The irony is my son was in University 2nd Year when we got Occupation Certificate for the House 6 weeks ago.

Our first DA Plans were put in 2015 after extensive consultation with the Council, but being a battle-axe block and surrounded by 9 Neighbours, the plans met with heated debates and Objections and finally, the Council refused the DA altogether after a Tribunal Hearing. 

None of the Neighbours had objected when the Land was being sub-divided and there was no height specific clause (like only a single storey being built) in the Land Title and the Plans conformed to the Planning Regulations of NSW. Centre to this issue was a huge Tree in the backyard and being a Moderate Bushfire Zone, it was ideal to have that removed and an Arborist Report by a Level 8 Arborist (referred to by the Council) suggested that. Several Trees had already been removed from the Property prior to sub-division. 

Lost $30,000 already as a result of Council Fees, drawings and plans being drawn and spent a similar amount to have them redrawn from scratch again and re-submit to the Council as new DA in 2016 after extensive consultation again. The DA was met with further Comments from the same people and also from the new Residents who had bought into the neighbourhood subsequently. After a few changes, Plans were approved in May 2016.

That was in the midst of construction boom in Sydney and it was very hard to find a reasonable Builder for a Block, which involved building on Rock, Preservation of Trees, sewer encasement, considerable slope at the rear, narrow access, moderate bush fire zone and a considerable affect by overland storm flows, etc. The Block also had the following Easements:

            A 1.5 metre Easement (A) right through the Centre;

            A one metre Easement (C) at Rear of Property;

            A  1.61 metre Easement (D) for stormwater;

            A Sewer pipe right through the Left of the Property, calling for encasement if building over it.

Unable to find a suitable Builder, I decided to start work as Owner Builder having had prior experience with minor Building works. At every stage, Neighbours kept complaining regarding windows overlooking their Property, despite the fact that one side of the House was mainly frosted windows and a lot of other windows were Highlight and screened. At one Stage, Council asked all Windows to be changed to Frosted, on the basis of current Neighbour's Objections. This issue was fought and it was changed back to clear windows, as the DA had already been approved, windows already in place and brickwork already done. 

During the Building period, my younger son who was 17 at the time, met with a serious car accident an almost near death experience had it been a bigger car, whilst he was a pedestrian and had to be hospitalized for multiple trauma, 4 major broken bones and several ligaments damage. He was in Hospital for almost 4 Months and still needs therapy for his movements. That delayed the Project by 5-6 Months. A few months after that, my wife was diagnosed with a 15 cms fibroid tumour in her uterus, which had to be removed in Emergency as it was giving rise to other complications. 

Adding to our misery, Revenue NSW contacted us by PHONE just a month prior to the 4 years exemption being over (Nov 2018) and asked to explain the causes of the delay. Same night as advised, a detailed email along with several attachments (spread across 4 Emails) was sent, which was received / deliberately deleted by Revenue NSW and there was no bounce back. The only written contact I got from Revenue NSW was in the middle of January 2019, which was a penalty notice. Their Communication has been minimum and abysmal. Now I have lost all the Internal Appeals as I am dealing with some of the heartless people in the Industry. For the delays which were beyond my direct control, they are charging me almost $45,000 for Land Tax which has been back-dated to 2014. The Government prides itself in hitting the Banks when they charge outrageous interest rates, but it itself charges heaps more without proper notification. No one has been able to tell me, but they seem to be charging more than 10 percent interest rate on the penalty from the time it was due. 

I have contacted Government Officials last year and every time, my Letters go back to Revenue NSW who have already decided the outcome. A fair process would be to look at my reasons for the delay and that they were clearly beyond my control. Building a new home in Sydney is not easy and is riddled with bureaucratic delays, a myriad of rules and regulations, the rigmarole, neighbour disputes and unexpected project delays. A reasonable tolerance would be expected from this Government, in times of high property values and the taxes we are being charged adds to the property price and makes owning a Home a distant dream for most. My House has cost me almost $200,000 by way of Stamp Duty, Council Fees and levies, GST and Land Tax and total taxes will be almost 23-25% of the total building cost. Plus, we have suffered extensively as we had been Renting for 5 years plus paying Mortgage for vacant land. 

I would expect the Minister for Finance to look deeply into my case and to relieve me of this unexpected burden and being a Family of 5, only one who has been through the building process will understand what impact that can have on family life, trust and the finances. Instead of spending time with kids growing up, teaching them new things and taking them on Holidays, Games, Excursions, etc. we have been bombarded with just trying to get our building Plans approved and the house being built so that we can move in as a Family. 

We have been through this profound episode and the last 5-6 years have affected our lives so deeply and radically that what we had thought to be a reasonable and straight-forward process turned out to be a nightmare.

I request the Minister to remove the Exemption Clause Limit of 4 years from Land Tax, where the Land is to be used as a PPOR, if there is no other property being declared as a PPOR. Or, at least have some discretion added to the Commissioner's powers so that each case is judged on its merits. I also request the Minister to carefully look into my Case (Land Tax Client ID 87452178) again, which is currently sitting in the NCAT (NSW Civil and Administrative Tribunal) and my chance of winning there are minimal as there is no discretionary power available to the Tribunal to overturn the decision by Revenue NSW.

I request support from all readers to this petition as this issue does not only affect me, but can affect many more planning to build a future Home or upgrading their current Home. Taxes are good for the social viability of the nation, but when they start intruding upon family finances, impeding progress and affecting the upbringing of future citizens, taxes can be a huge burden and we need a fundamental tax reform aimed at improving equity and fairness for all.

Thanking all readers in advance and expecting a favorable response to my Petition aimed at changing the rules for the better.

Rajiv Khanna