Courts provide welcome clarity of ‘real property’ under Division 855

These decisions provide much-needed clarity for foreign investors and taxpayers on their existing Australian investments, as detailed by Matt Ervin and Shalini De Silva.

In two decisions handed down over the last fortnight, the Federal Court has dismissed the Commissioner's very broad view of the meaning of 'real property' under Division 855 of the Income Tax Assessment Act 1997 (Cth) (Division 855). The Courts have emphatically confirmed that 'real property' must be understood in its technical, legal sense, and expressly rejected the Commissioner's expansive interpretation that sought to import a 'general' meaning of real property that might treat physically...

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Authors: Matt Ervin, Shalini De Silva

Published Date: 11 November 2025