Frequently Asked Questions
Thinking of buying an NRAS property?
Thinking of selling your NRAS property?
What happens my NRAS is coming to an end?
Thinking of selling your NRAS property?
What happens my NRAS is coming to an end?
Thinking of buying an NRAS property?
What is the NRAS?
The National Rental Affordability Scheme (NRAS) is a joint Commonwealth and State program aimed at increasing the supply of affordably rental housing for low to moderate income households.
What are the basic rules?
The Scheme requires that the rent be charged at no greater than 80% of market rent and it must be let to an eligible tenant. You or your PM choose the tenant. Rent is indexed annually with a market rental valuation required at the end of year seven.
Who is Affordable Housing Consulting?
Affordable Housing Consulting (AHC) is a private business and is the Approved Participant for this property and undertakes the compliance obligations for the Scheme. Investors do not deal directly with the government department that administers the Scheme, AHC makes sure the rules of the NRAS are followed and investors are paid. We are governed by the NRAS Legislation and a code of conduct which can be found on our website.
How much is the total incentive?
In 2022 / 2023, the incentive is $11,168. $8,376 Refundable Tax Offset and $2,792 Non Assessable Non Exempt Income (Cash payment). Partial years attract partial payment. Payment relies on compliance with the Scheme rules.
What is a Refundable Tax Offset?
This is the amount you claim through your tax return. It is not a deduction, it is paid as an offset to your tax obligations and if it exceeds your tax obligations the difference will be refunded to you. Can find more on the ATO website searching "NRAS"
What is Non-Assessable Non Exempt Income?
This is the amount funded by the State Government and is paid as cash into your bank account. It is not assessable income (tax free) however you may not claim expenses incurred in earning this income.
When do I get paid?
The NRAS year runs from 1st May to 30th of April, the Refundable Tax Offset is typically issued in July or August and the State payment typically arrives a month later. AHC does not guarantee timing of payment.
What expenses are there?
AHC takes a share of the State payment equivalent to 12.5% of the NRAS Incentive to manage the compliance of the Scheme and a contract administration fee for $550 to establish your entitlement to the NRAS Incentive, we deduct this from your first state payment.
Can I use my own Property Manager?
No, AHC has a panel of property managers who are familiar with the Scheme rules and AHC's compliance software, the incumbent property manager is familiar with the tenant and the property and would be a good place to start.
What are the tenants like?
Eligibility limits are quite generous, a single person may earn up to $54,643 and a couple with three children may earn up to $129,929, so in most cases the income profiles are similar to the neighbourhood.
Will this affect demand for my property?
Because tenants are receiving a discounted rent, we find a greater than usual number of applicants and longer tenancies, which means fewer vacancies.
Are there tax considerations I should consider?
If you have any tax questions they should be directed to your accountant and you may find more detail by searching for NRAS on the ATO website.
Do I have to participate in the NRAS if I buy the property?
No, although as with any property, if there is a tenant in the property you will need to comply with the Residential Tenancies Act, so you may wish to participate in the NRAS until the end of the tenancy.
I want the property to remain in the NRAS, what next?
There is no approval process and no upfront fee to be an investor of a property in the NRAS, contact AHC at compliance@nras.com.au and we will answer any further questions you have and get you started.
What happens after the 10 years?
The NRAS for your property ends and the agreement with AHC sunsets. You are no longer obliged to discount the rent to the tenant and you will not earn an incentive beyond that period. You will be entitled to an incentive for the portion of the NRAS year the property was active in the Scheme
I've got more questions, where do I go to find out more?
Government (Search DSS NRAS)
https://www.dss.gov.au/our-responsibilities/housing-support/programmes-services/national-rental-affordability-scheme/
ATO (Search ATO NRAS)
https://www.ato.gov.au/Individuals/Investments-and-assets/In-detail/Rental-affordability-schemes/National-rental-affordability-scheme
AHC : https://nras.com.au
email: compliance@nras.com.au
The National Rental Affordability Scheme (NRAS) is a joint Commonwealth and State program aimed at increasing the supply of affordably rental housing for low to moderate income households.
What are the basic rules?
The Scheme requires that the rent be charged at no greater than 80% of market rent and it must be let to an eligible tenant. You or your PM choose the tenant. Rent is indexed annually with a market rental valuation required at the end of year seven.
Who is Affordable Housing Consulting?
Affordable Housing Consulting (AHC) is a private business and is the Approved Participant for this property and undertakes the compliance obligations for the Scheme. Investors do not deal directly with the government department that administers the Scheme, AHC makes sure the rules of the NRAS are followed and investors are paid. We are governed by the NRAS Legislation and a code of conduct which can be found on our website.
How much is the total incentive?
In 2022 / 2023, the incentive is $11,168. $8,376 Refundable Tax Offset and $2,792 Non Assessable Non Exempt Income (Cash payment). Partial years attract partial payment. Payment relies on compliance with the Scheme rules.
What is a Refundable Tax Offset?
This is the amount you claim through your tax return. It is not a deduction, it is paid as an offset to your tax obligations and if it exceeds your tax obligations the difference will be refunded to you. Can find more on the ATO website searching "NRAS"
What is Non-Assessable Non Exempt Income?
This is the amount funded by the State Government and is paid as cash into your bank account. It is not assessable income (tax free) however you may not claim expenses incurred in earning this income.
When do I get paid?
The NRAS year runs from 1st May to 30th of April, the Refundable Tax Offset is typically issued in July or August and the State payment typically arrives a month later. AHC does not guarantee timing of payment.
What expenses are there?
AHC takes a share of the State payment equivalent to 12.5% of the NRAS Incentive to manage the compliance of the Scheme and a contract administration fee for $550 to establish your entitlement to the NRAS Incentive, we deduct this from your first state payment.
Can I use my own Property Manager?
No, AHC has a panel of property managers who are familiar with the Scheme rules and AHC's compliance software, the incumbent property manager is familiar with the tenant and the property and would be a good place to start.
What are the tenants like?
Eligibility limits are quite generous, a single person may earn up to $54,643 and a couple with three children may earn up to $129,929, so in most cases the income profiles are similar to the neighbourhood.
Will this affect demand for my property?
Because tenants are receiving a discounted rent, we find a greater than usual number of applicants and longer tenancies, which means fewer vacancies.
Are there tax considerations I should consider?
If you have any tax questions they should be directed to your accountant and you may find more detail by searching for NRAS on the ATO website.
Do I have to participate in the NRAS if I buy the property?
No, although as with any property, if there is a tenant in the property you will need to comply with the Residential Tenancies Act, so you may wish to participate in the NRAS until the end of the tenancy.
I want the property to remain in the NRAS, what next?
There is no approval process and no upfront fee to be an investor of a property in the NRAS, contact AHC at compliance@nras.com.au and we will answer any further questions you have and get you started.
What happens after the 10 years?
The NRAS for your property ends and the agreement with AHC sunsets. You are no longer obliged to discount the rent to the tenant and you will not earn an incentive beyond that period. You will be entitled to an incentive for the portion of the NRAS year the property was active in the Scheme
I've got more questions, where do I go to find out more?
Government (Search DSS NRAS)
https://www.dss.gov.au/our-responsibilities/housing-support/programmes-services/national-rental-affordability-scheme/
ATO (Search ATO NRAS)
https://www.ato.gov.au/Individuals/Investments-and-assets/In-detail/Rental-affordability-schemes/National-rental-affordability-scheme
AHC : https://nras.com.au
email: compliance@nras.com.au
Thinking of selling you NRAS Property?
Can I sell my NRAS property before the 10 year term ends?
Yes, as an NRAS property investor, you have the right to sell your property at any time throughout the 10 year NRAS term, however there are some details you need to be aware of;
Is there a specific agent I must use?
You are free to use a sales agent of your choice, however they should have a basic understanding of the NRAS and the NRAS Owner Agreement. We recommend they contact us by email for information specific to the property and NRAS, which can be passed to prospective investors.
I am unsure which agent to use, can AHC recommend one familiar with NRAS?
AHC is agent agnostic although typically your property manager will be most familiar with the NRAS and the specific details of your property and will be better placed to manage the tenancy whilst the property is on the market. This makes your property manager a good place to start.
When should I let AHC know I’m selling my property?
Please advise AHC by email once you list your property with an agent. We can then provide your agent with a copy of the AHC NRAS Owners Agreement and information relating to the remaining NRAS for the property.
Is there a fee for exiting early?
Under the standard NRAS Owners Agreement, there is an exit fee if your property exits the NRAS scheme prior to fulfilling the full 10 year term.
How is the exit fee calculated?
The fee is calculated at 7.5% of the current NRAS incentive payment multiplied by the number of years left in the 10 year term.
E.g. The 2022/23 NRAS incentive payment is $11,169. If you had 3 years left in the NRAS term, the amount payable would be calculated at $11,169 x 0.075 x 3 which equals $2513.02
Can the remaining NRAS be transferred to the purchaser?
Yes. It is recommended the purchaser be provided with a copy of the agreement prior to signing a contract and, or the expiry of any cooling of period.
Is there a fee to transfer the remaining NRAS, and who pays this?
Yes, there is a $550 establishment fee payable to transfer the NRAS, this is paid by the purchaser, who must enter into a new agreement with AHC.
What happens at settlement?
Once the property transfer has been completed, your sales agent or conveyancer will need to advise AHC by email, as well as the date this was completed. The conveyancer does not adjust the NRAS incentive payment, this is done by AHC at the end of the NRAS year.
Can I sell my property without a tenancy in place?
Yes, however if the property is vacant for 182 days or more, no incentive will be paid for the entire NRAS year as per the NRAS regulations.
What is the best email address to advise AHC I will be selling my property?
compliance@nras.com.au
Yes, as an NRAS property investor, you have the right to sell your property at any time throughout the 10 year NRAS term, however there are some details you need to be aware of;
Is there a specific agent I must use?
You are free to use a sales agent of your choice, however they should have a basic understanding of the NRAS and the NRAS Owner Agreement. We recommend they contact us by email for information specific to the property and NRAS, which can be passed to prospective investors.
I am unsure which agent to use, can AHC recommend one familiar with NRAS?
AHC is agent agnostic although typically your property manager will be most familiar with the NRAS and the specific details of your property and will be better placed to manage the tenancy whilst the property is on the market. This makes your property manager a good place to start.
When should I let AHC know I’m selling my property?
Please advise AHC by email once you list your property with an agent. We can then provide your agent with a copy of the AHC NRAS Owners Agreement and information relating to the remaining NRAS for the property.
Is there a fee for exiting early?
Under the standard NRAS Owners Agreement, there is an exit fee if your property exits the NRAS scheme prior to fulfilling the full 10 year term.
How is the exit fee calculated?
The fee is calculated at 7.5% of the current NRAS incentive payment multiplied by the number of years left in the 10 year term.
E.g. The 2022/23 NRAS incentive payment is $11,169. If you had 3 years left in the NRAS term, the amount payable would be calculated at $11,169 x 0.075 x 3 which equals $2513.02
Can the remaining NRAS be transferred to the purchaser?
Yes. It is recommended the purchaser be provided with a copy of the agreement prior to signing a contract and, or the expiry of any cooling of period.
Is there a fee to transfer the remaining NRAS, and who pays this?
Yes, there is a $550 establishment fee payable to transfer the NRAS, this is paid by the purchaser, who must enter into a new agreement with AHC.
What happens at settlement?
Once the property transfer has been completed, your sales agent or conveyancer will need to advise AHC by email, as well as the date this was completed. The conveyancer does not adjust the NRAS incentive payment, this is done by AHC at the end of the NRAS year.
Can I sell my property without a tenancy in place?
Yes, however if the property is vacant for 182 days or more, no incentive will be paid for the entire NRAS year as per the NRAS regulations.
What is the best email address to advise AHC I will be selling my property?
compliance@nras.com.au
What happens my NRAS is coming to an end?
My NRAS 10-year term is coming to an end, can it be extended?
No, once the 10 year term ends, you will no longer be eligible for the annual NRAS incentive payment and will receive a pro-rated payment for the final NRAS year.
Am I require to continue to rent to the tenant in place once the 10 year term ends?
Once the NRAS term has expired, you are no longer required to rent the property to an eligible tenant, and do not need to discount the rent.
When can I increase the rent to market rent once the NRAS ends?
If your tenant’s lease ends at the same time the NRAS term does, you can start charging market rent for future renewals for that tenant, or if you re-let the property from then on.
If there is already a lease in place beyond the NRAS end date, you will need to get in touch with your Property Manager to discuss any options.
What happens if my tenant’s lease ends prior to the expiry of the NRAS term?
Consulting with the property manager and tenant about your situation should give you the greatest choice of options. Where feasible it’s best if you renew the lease or sign a new lease that aligns with the end date of the NRAS term, providing you with the greatest amount of flexibility and avoid having to discount the rent for a period where you will not be eligible for the NRAS incentive payment. It may also be feasible to include a rent review mid lease but at the end of the NRAS period.
My tenant is vacating within 3 months of the NRAS term ending, can I advertise the property at market rent and exit the NRAS prior to the 10 year term?
AHC will waive the exit fee if you exit the NRAS within 3 months of the NRAS ending, allowing you to advertise the property at market rent for future tenancies. The NRAS incentive will only be payable whilst the property is let to an eligible tenant.
My NRAS 10 year term is coming to an end, can I advertise my property for sale?
Yes, you are welcome to list your property for sale at any time during the 10 year term. AHC will waive the exit fee within the last 3 months of the NRAS term if the property sells or becomes vacant and is listed for sale. The NRAS incentive will only be payable whilst the property is let to an eligible tenant.
Do I need to let AHC know that my property is coming to the end of the 10 year term?
No, AHC will submit any remaining claims on your behalf at the end of the NRAS year and payments will be processed as usual.
My property has sold and settles after the 10 year term ends, do I need to let AHC know?
No, if the NRAS term has ended, AHC do not need to know if settlement occurs after the term sunsets.
No, once the 10 year term ends, you will no longer be eligible for the annual NRAS incentive payment and will receive a pro-rated payment for the final NRAS year.
Am I require to continue to rent to the tenant in place once the 10 year term ends?
Once the NRAS term has expired, you are no longer required to rent the property to an eligible tenant, and do not need to discount the rent.
When can I increase the rent to market rent once the NRAS ends?
If your tenant’s lease ends at the same time the NRAS term does, you can start charging market rent for future renewals for that tenant, or if you re-let the property from then on.
If there is already a lease in place beyond the NRAS end date, you will need to get in touch with your Property Manager to discuss any options.
What happens if my tenant’s lease ends prior to the expiry of the NRAS term?
Consulting with the property manager and tenant about your situation should give you the greatest choice of options. Where feasible it’s best if you renew the lease or sign a new lease that aligns with the end date of the NRAS term, providing you with the greatest amount of flexibility and avoid having to discount the rent for a period where you will not be eligible for the NRAS incentive payment. It may also be feasible to include a rent review mid lease but at the end of the NRAS period.
My tenant is vacating within 3 months of the NRAS term ending, can I advertise the property at market rent and exit the NRAS prior to the 10 year term?
AHC will waive the exit fee if you exit the NRAS within 3 months of the NRAS ending, allowing you to advertise the property at market rent for future tenancies. The NRAS incentive will only be payable whilst the property is let to an eligible tenant.
My NRAS 10 year term is coming to an end, can I advertise my property for sale?
Yes, you are welcome to list your property for sale at any time during the 10 year term. AHC will waive the exit fee within the last 3 months of the NRAS term if the property sells or becomes vacant and is listed for sale. The NRAS incentive will only be payable whilst the property is let to an eligible tenant.
Do I need to let AHC know that my property is coming to the end of the 10 year term?
No, AHC will submit any remaining claims on your behalf at the end of the NRAS year and payments will be processed as usual.
My property has sold and settles after the 10 year term ends, do I need to let AHC know?
No, if the NRAS term has ended, AHC do not need to know if settlement occurs after the term sunsets.