Qld stamp duty double dip

[Wayfarer73]

If anyone could help me with the following, it would be a great help. I bought a property in Brisbane with a friend. We paid $700k for it, and are going to separate titles(already on 2 lots), demo the house, then split the titles and build a house each.

My question is we've already paid about $12,500 duty each. Now when we split the titles, I've been informed that we are liable to pay about $4,500 each including solicitors fees.

I understand that I'm buying my business Partner out, but consideration hasnt changed. I read in the duties act somewhere about you can't pay the tax twice, if the consideration hasn't changed.

Thanks in advance.

 

[Terry_w]

So you want to split the titles and end up owning one block each?

This would be a dutiable transaction because ownership is changing.

What you should have done was to partition the land when you bought it. This involves each buying the exact % of the land that you would have ended up with and used a deed to outline this split. Then when you actually split the titles you are only ending up with your original share so there would only be nominal duty -$50 or so.

Did you seek legal advice on the duty aspects when purchasing?

 

[Wayfarer73]

Thanks for the advice Terry. My partner is adverse to spending any money upfront to get such advice. The few hundred dollars would be a bargain at this stage. We did use a solicitor to do the conveyancing, my partner should have told them our plans, unfortunately he too busy watching the pennies, whilst the pounds are falling out his pocket?

Stamp duty is not a deduction either is it, its a capital expense?? Atleast I should have a blue chip property at the the end? Haven't even signed the building contract, and the builder has his hands in my pocket!

 

[Terry_w]

Yes, just think of the increase in profit on the block!

At least the stamp duty would be deductible against any gains when you sell so not all bad.

 

[Wayfarer73]

I know, the only problem is I want to hold it long term, so in 10 years time it won't be worth as much!!

 

[Jtkumnick]

The Gov said stamp duty would be abolished when the GST came in so I dont know what you are talking about- Gov always do what they say.