Capital Works (Build to Rent Misuse Tax) 2024

# Capital Works (Build to Rent Misuse Tax) Bill 2024 ## What it does The government is introducing a new tax on developers who misuse "build to rent" schemes. Developers who were supposed to build rental housing but fail to meet the requirements will now pay a 1.5% tax on the amount they should have spent on legitimate rental housing. This is designed to penalise developers who take advantage of tax breaks meant to encourage rental housing construction without actually delivering it. ## Why it matters Build to rent schemes offer tax incentives to encourage developers to build more rental properties for everyday Australians. When developers game the system and pocket the tax benefits without delivering housing, it undermines the whole scheme and makes the housing shortage worse. This tax aims to make that behaviour genuinely costly. ## Key details - **Tax rate**: 1.5% of the "build to rent misuse amount" (the gap between what developers were supposed to spend and what they actually spent on legitimate rental housing) - **Commencement**: The law kicks in on the first quarterly date (1 January, April, July, or October) after it receives Royal Assent - **How it works**: The tax applies to each income year separately, calculated under existing tax assessment rules

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