Your client moves into her first home in February. A genuine medical need takes her back to her parents' place a few months later. The Tribunal believes her about that.
She still loses, and the $51,466 bill for duty, penalty and interest stands. The reason is a decision she made five days before the six months were up.
Chew v Chief Commissioner of State Revenue [2026] NSWCATAD 200
What Happened
First, the basics. To keep the first home buyer duty exemption, the buyer must occupy the home as her principal place of residence for a continuous period of at least six months, starting within twelve months of completion. At the relevant time the period was six months, now it is twelve. Senior Member EA MacIntyre heard the review.
Ms Chew bought an $800,000 unit and moved in during late February 2021. In June she returned to her parents' home for the care she needed to manage certain medical conditions, over a period that also covered the COVID lockdowns. That move did not sink her. The Senior Member accepted her reasons for leaving as both “reasonable and adequately explained” [43 - 44].
LEAVING WAS FINE. RENTING IT OUT WAS FATAL.
So why did she lose? Because of what she did inside the window, not why she left it. The six months of continuous occupation had to run to at least 25 August 2021 [45]. Yet by 20 August she had emailed that she had decided to move out, and ATO records showed the unit available to rent from 19 August [46 - 47].
She then arranged a removalist and let the unit to a tenant from October 2021 [48 - 49]. More than four years on, she had never moved back [60]. The Senior Member found that steps had been taken “to leave the property and use it to earn rent” [50].
The Practical Takeaway
First, a good reason for leaving is not the whole test. The occupation must stay continuous, and a decision to rent the home out inside the six months breaks it even where the reason for the initial absence is accepted [51].
Second, the good reasons discretion in s 76(2) will not rescue a home that has become an investment. Leaving to receive care might have qualified, but letting the unit defeated it [58 - 59].
Third, watch what your client tells Revenue NSW. Ms Chew maintained she had resided in the unit for longer than six months. Her own emails, the rental listing and the utility records said otherwise, and the 25% penalty stood [70 - 71].
How many of your first home buyer clients moved out early, then quietly put the place on the rental market?
Norton & Quay Tax Law acts for taxpayers in disputes just like this one.
General information only. This note was written as at 15 July 2026 and the law may have changed since. It is not legal or tax advice, does not take account of your circumstances, and must not be relied upon as a substitute for advice on your own matter.