NSW Stamp Duty Changes Ahead

KSV 20
22
Jun

NSW Stamp Duty Changes Ahead

22.06.16

The NSW government has announced a number of changes affecting stamp duty as part of the state budget.  Applying from 1 July 2016, the changes are proposed to help businesses grow by abolishing more than $400 million a year in business tax.

 

MORTGAGE DUTY

From 1 July 2016, mortgage duty will be abolished in NSW.  This will apply to all mortgages executed on or after this date.  Mortgage duty will also not apply to variations of existing mortgages which previously required upstamping.

 

SHARE TRANSFER DUTY

Share transfer duty will be abolished in NSW.  Shares currently held in NSW proprietary companies or in a foreign company kept on a NSW registry must be stamped on transfer.  This will not be required after 1 July 2016.  Agreements to transfer shares will also not incur stamp duty after 1 July 2016.

 

DUTIES ON OTHER TRANSFERS

Duty on transfers of units in NSW Unit Trusts will also be abolished from 1 July 2016.  Such transfers will not require stamping after this date.

 

Duty on the transfer of certain business assets will be abolished from 1 July.  However, this does not include land or leasehold property.

 

LANDHOLDER DUTY

The above changes may not apply for “landholders” – companies or trusts with real estate assets worth in excess of $2M.  For landholders, certain acquisitions of shares or units will continue to attract transfer duty.

 

STAMP DUTY FOR FOREIGN PROPERTY INVESTORS

The NSW Budget released on June 21 announced a 4% stamp duty surcharge for foreigners buying real estate, effective immediately.  In addition, foreign buyers will pay an additional 0.75% land tax surcharge from January 1 2017.  The changes follow similar surcharges for foreign property investors in Victoria and Queensland.

 

The surcharges will not apply to Australian citizens, permanent residents of Australia or New Zealanders who have resided in Australia for at least 200 days in the past 12 months.  The new surcharges for foreign buyers are expected to add $1 billion to the NSW budget over four years.

 

Should you have any questions in relation to the above, or stamp duty and property investment in general, please contact your ESV engagement partner on 02 9283 1666.