The Boarding Houses Bill 2012 became the Boarding Houses Act (“Act”) on 29 October 2012 and is new legislation which regulates certain boarding houses in NSW, and helps to protect boarding house residents. Its stated aims are to provide a registration system for registrable boarding houses and to promote and protect the well being of residents in those boarding houses. The provisions of the Act relating to registration commenced on 1 January 2013. The remainder of the Act will not commence until regulations have been finalised which is expected to happen during the 2013 Budget Session of the NSW Parliament.

Registrable Boarding Houses

A registrable boarding house is either:

A general boarding house: it accommodates five or more paying residents; or

A regulated assisted boarding house: it accommodates two or more residents with additional needs such as a person who has an *Age related frailty, a mental illness and/or a psychiatric, sensory or physical disability.

The proprietor of a registrable boarding house (who can either be a lessee of the boarding house if it is leased or if it is not, the owner) used as such as at 1 January 2013 must register with NSW Fair Trading that registrable boarding house by 30 June 2013 by providing basic identification information as well as information about the number of residents, beds and bedrooms and other profiling information.

Sales and Purchase

Boarding houses are known as commercial residential premises.

If any person intends to sell his or her boarding house, he or she is generally making a taxable supply and is liable for Goods and Services Tax (GST) of one-eleventh of the sale price.

One can sell his or her boarding house in either of the following ways:

Under the margin scheme; or

As a going concern.

GST credits can be claimed on purchases that relate to selling of the property.

If any person is intending to purchase a boarding house, he or she can claim the GST included in the purchase price of the boarding house as long as:

The seller did not use the margin scheme to work out the GST included in the price, or

The sale was not a GST-free sale of a going concern to the purchaser and the seller was registered or required to be registered for GST

The purchaser can also claim GST credit on other expenses, such as solicitor’s fees, that relate to buying the boarding house.

The NSW Government provides assistance or grants of $10,000 per room to boarding house operators for construction of new boarding house accommodation, or for constructing additional new rooms in the existing boarding houses.The funding program is managed by the Boarding House Financial Assistance Program administered by NSW Housing. The grants are paid out in equal annual instalments of $2,000 over five years for each room. The Boarding House Financial Assistance Program also provides grants to help operators of boarding houses undertake essential fire safety works.


Currently a boarding house which accommodates two or more handicapped people is required to be licensed under the Youth and Community Services Act 1973 and the Youth and Community Services Regulation 2010. This legislation will be repealed by the Act which takes into account the wellbeing and protection of such people in a registrable boarding house.

In addition to providing for the registration of all registrable boarding houses with NSW Trading, the Act provides the following new framework for the regulation of registrable boarding houses in NSW:

Common accommodation standards for all boarding houses;

Mandatory inspections by local councils;

Occupancy rights for residents; and

Improved regulation of boarding houses for persons with a disability which are licensed under the Youth and Community Services Act 1973.

In relation to registrable boarding houses being required to be registered with NSW Fair Trading, a Boarding House Registration Form will need to be completed and it must be forwarded to the address mentioned on the form or submitted at a Fair Trading Centre together with the registration fee.

Owen Hodge Lawyers can assist with registration under the Act.

The following information will be available from the boarding house register to the public:

Name and address of the boarding house;

Name and the residential or business address of each proprietor of the boarding house; and

Whether the boarding house is a general boarding house or a regulated assisted boarding house.

Occupancy Rights of The Residents

According to the Act, registrable boarding house residents have a basic set of occupancy rights and these are outlined below:

Living in premises that are reasonably clean, in a reasonable state of repair, and reasonably secure;

Being entitled to know the rules of the boarding house before residing;

Being entitled to quiet enjoyment of the premises;

Being entitled to 4 weeks’ written notice of an increase in the occupancy fee;

Being notified before signing an agreement if there will be a charge for utilities;

Being charged for any utility according to the cost of providing it plus usage by the resident;

Being entitled to know why an occupancy may be terminated and how much notice will be given before termination;

Being given reasonable written notice of eviction;

Being given written receipts for any money paid to the proprietor; and

Paying a security deposit limited to 2 weeks’ of occupancy fee to be repaid within 14 days of the end of the occupancy, less certain allowable deductions.

Residents will also be able to enforce these rights at the Consumer, Trader and Tenancy Tribunal. It is anticipated that the occupancy laws will commence in mid 2013. Owen Hodge Lawyers can advise you on how to ensure you comply with these laws, advise you on the changes and assist you through the registration process.

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