Deed of Apparent Purchaser

I dont see many questions or enquiries about prospective purchasers using the Deed of Apparent Purchaser provisions which operates in most states. Its probably fallen out of favour in Vic as their duty Act has other provisons. But there are some instances where DofAP might benefit too.

Basic and VERY simplistic run down of DofAP is that A buys property using funds provided by B. Title is in A's name. At a later stage A's girlfriend (or other person seeking to make claim on the asset eg : bankruptcy) wants a claim on house. So B steps forward and the deed permits A to transfer property to B for nominal duty rather than transfer duty. Deed basically declares that A was holding it on Trust for B and was never A's. Proof is required such as evidence that B provided funds. Technically its a resulting trust.

Anyone doing this - examples ? Any lawyers who are up with this ? At times these provisons can assist to fix title issues later on. eg : Mum & dad buy jointly yet 100% of the cash was provided by Mum. It can be possible to transfer title to mum without transfer duty. Anyone share more ??
 
Hi Paul

This is a resulting trust type situation, s55 Duties Act NSW from memory. I haven't done any of these transfers myself but looked into it briefly when I had another lawyer trying to claim he urchased the house he was in as trustee for the wife.

It gets complicated when loans are involved as whoever provides the money for the purchase is the beneficial owner and if there is a loan the loan will usually be in the name of the title holder. If the loan is in joint names then perhaps the non title holder's share would be limited to their share of the loan.

Also in terms of asset protection, on bankruptcy of the title holder the trustee would probably srie the house it would then up to the beneficiary to mount a challenge that they title holder was acting as trustee for them and they were the real beneficial owner.

If not planned from th beginning this sort of thing is diffiult to prove and convince the OSR that on $50 duty should be applied to a transfer and even more difficult to conince a trustee in bankruptcy.
 
Hi Paul

This is a resulting trust type situation, s55 Duties Act NSW from memory. I haven't done any of these transfers myself but looked into it briefly when I had another lawyer trying to claim he urchased the house he was in as trustee for the wife.

It gets complicated when loans are involved as whoever provides the money for the purchase is the beneficial owner and if there is a loan the loan will usually be in the name of the title holder. If the loan is in joint names then perhaps the non title holder's share would be limited to their share of the loan.

Also in terms of asset protection, on bankruptcy of the title holder the trustee would probably srie the house it would then up to the beneficiary to mount a challenge that they title holder was acting as trustee for them and they were the real beneficial owner.

If not planned from th beginning this sort of thing is diffiult to prove and convince the OSR that on $50 duty should be applied to a transfer and even more difficult to conince a trustee in bankruptcy.

Yep s55 is the resulting trust provison in NSW. Other states too. NSW OSR Ruling DUT030. Proof of who provided funds is key. My understanding is that the docs are provided to OSR after (never before !) title is acquired to prove who paid the $$$. OSR stamp the deed of resulting trust and all the evidence docs (incl loans) and they are kept for a day in the future. Hoping someone might have been involved and explain practices involved for simple issues. The DUT030 explains that husband to wife transfer can be done for $50.....Thats why I wanted to get better understanding.
 
This is just like a custoian trustee purchassing on behlf of a SMSF trustee. SMSF provideds the deposit money and the loan. After settlement you provide the OSR with evience of this and then 30 years later when the loan is paid off and the title transferrred to the SMSF trustee (the beneficial owner) there is only $50 stamp duty
 
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