Stamp Duty on on-sale of IP

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From: Monica F.


Hiya,

Recently purchased an IP off the plan for $372k. Have had to sell prior to completion (due for november this year). I have found a buyer willing to pay $395k. Works out well for me IF (and only if) i dont have to pay stamp duty but i am told that i do have to pay stamp duty.

Surely some intelligent person on this forum knows of a smart way for me to avoid paying the stamp duty.

Does having a hubby (on a lower income than I ) and not having any IP's in his name help ? first home buyers grant for him?
 
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Reply: 1
From: GoAnna !


What state are you in? If you are in Victoria the news is good.


GoAnna !
(aka Anna before she got real)
 
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Reply: 1.1
From: Monica F.


NSW .... still good news ??
 
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Reply: 1.2
From: GoAnna !


Less good....could those in the know in NSW please stand up and assist!

Sorry, I am from Victoria and all I know is that we are the only ones to enjoy stamp duty savings when buying off the plan.

GoAnna !
(aka Anna before she got real)
 
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Reply: 2
From: Paul Zagoridis


Is it in your name or Hubby's? Does he qualify for FHOG? and if so isn't there also Stamp Duty relief for FHO's?
 
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Reply: 2.1
From: Monica F.


unit in my name. I am not sure if he is legible for FHOG - i still have to read the fine print
 
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Reply: 2.2
From: Yuch .


To qualify for FHOG Plus, which is $7000 + exemption on stamp duty, the purchase price of the property has to be under $200K.

So doesn't look like you are gonna get away from it this time....

Regards
yuchun
 
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Reply: 2.2.1
From: Gee Cee Cee


Without being personal;
Why are you selling?

Could you rent it then sell?

Gee Cee
 
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Reply: 2.2.1.1
From: Jeanette .


For you to have legal title to sell to someone else, you have to (eventually) be registered on the title. The Land Titles Office will only accept a transfer that has a receipt and stamp on it showing that the stamp duty has been paid. There is no way to avoid stamp duty.
The only way out of it is to ask the vendor would he rescind (let you out of) the contract if you give him the name of the purchaser that will buy in your place so that he doesn't lose. I honestly can't see him doing it without some small penalty to you for administration charges etc. though, but it is worth a try.
 
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Reply: 2.2.1.1.1
From: Owen .


What about the "and/or nominee" clause in the contract. If one exists can the title just be transferred to the new buyer before settlement? Could the $23k difference in this case, be accommodated in another separate contract for some other services? Stamp duty would then be paid on the original $372k by the new nominated buyer and Monica would pay either GST or income tax on the $23k extra.

Is this possible?
 
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Reply: 2.2.1.1.1.1
From: Jeanette .


But she probably didn't name herself in the contract as purchaser as 'Ms xxxx or nominee'. There is no general clause in the contract. You have to stipulate it at the time of exchange. It is usually done at auction when someone buys a property and must enter into the contract that day but is not sure whether it is going into single/joint names or company name. And this gives the purchaser a few days to decide whose name the title is to go into.
From a practical point of view, I have seen someone try to on-sell a property but when the new purchaser found out what was going on, they went direct to the original vendor and negotiated a better deal for themselves direct.
 
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Reply: 2.2.1.1.1.1.1
From: Owen .


On 4/20/01 9:56:00 AM, Jeanette . wrote:
>But she probably didn't name
>herself in the contract as
>purchaser as 'Ms xxxx or
>nominee'. There is no general
>clause in the contract. You
>have to stipulate it at the
>time of exchange.

Yup

>It is usually done at auction when
>someone buys a property and
>must enter into the contract
>that day but is not sure
>whether it is going into
>single/joint names or company
>name. And this gives the
>purchaser a few days to decide
>whose name the title is to go
>into.

Yup.

>From a practical point of
>view, I have seen someone try
>to on-sell a property but when
>the new purchaser found out
>what was going on, they went
>direct to the original vendor
>and negotiated a better deal
>for themselves direct.

Nup. If I have a contract to purchase a property with settlement in 6 weeks and a deposit paid, I don't think the vendor can then sell it to someone else. Can they? I though gazzumping was done during the 5 day cooling off period only, not when a contract is binding.

If I have a purchase contract with an "and/or nominee" clause in it, can I sell this for a higher price, change the original contract name to the new buyer (the nominee) and collect the difference for myself?

This would be used in the classic "buy off the plan, wait 2 years for building and on-sell before settlement" scenario in high growth/demand market. Never done it but I would like to know the mechanics of it once and for all. Should as my professionals I guess.

Anyone out there done this? Sounds pretty common. Who pays what stamp duties and what taxes?
 
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Sounds like flipping..

Reply: 2.2.1.1.1.1.1.1
From: Frode Egeland


>If I have a purchase contract with an
>"and/or nominee" clause in it, can I
>sell this for a higher price, change the
>original contract name to the new buyer
>(the nominee) and collect the difference
>for myself?

This is what I understand a flip to be all about.

>
>Anyone out there done this? Sounds
>pretty common. Who pays what stamp
>duties and what taxes?

I haven't done it, but here's my $.02 worth at any rate:
If you pass the contract on to your nominee for a fee, then you were never the purchaser, and you would only pay your normal income tax on the fee. Your nominee is the purchaser, and hence pays all the normal purchasing costs.

If someone with flip experience could comment, that would be great! :)

Cheers,
Frode
CashflowSydney
 
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Sounds like flipping..

Reply: 2.2.1.1.1.1.1.1.1
From: The Wife


Frode,

You are correct!
 
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Sounds like flipping..

Reply: 2.2.1.1.1.1.1.1.1.1
From: Owen .


But I was under the impression that the flipper never puts their name on the contract - "and/or nominee" clause or otherwise. To me a flipper was more like a buyers agent that never had a contract for the property in their own name and just found a negotiated for a property and then sold the deal to someone else for a separate fee.

I've always been told that flipping and "on-selling before settlement" where 2 different things. If they are the same then it makes a lot more sense.

OK then. If I on-sell to someone else, should I have a separate contract for my "fee" with the new purchaser? As Frode said, they will take care of every thing else with the original vendor.
 
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Sounds like flipping..

Reply: 2.2.1.1.1.1.1.1.1.1.1
From: The Wife


Owen, yes yes and yes :eek:)
 
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Sounds like flipping..

Reply: 2.2.1.1.1.1.1.1.1.1.1.1
From: Owen .


Spot the light bulb above my head. O=:^)
 
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Attention FLIPPERS !!! Question...?

Reply: 2.2.1.1.1.1.1.1.1.1.2
From: Ross Sondergeld


Hi


Can someone please give me the legal theory behind flipping...


1. How does a flip work? (i.e. The legal nitty gritty.)

2. Is a flipper an "agent"? (i.e. Do they act and behave like an agent?)
What are a flippers legal obligations to their client?

3. What is the flippers legal liability? (i.e. under the contract of sale
and to the buyer.)

4. Do flippers use a written employment agreement?



Detailed flipping answers and replies would be greatly appreciated !!!


Thank You...
Ross on the Gold Coast
_________________________________________________________________________
Get Your Private, Free E-mail from MSN Hotmail at http://www.hotmail.com.
 
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Attention FLIPPERS !!! Question...?

Reply: 2.2.1.1.1.1.1.1.1.1.2.1
From: The Wife


scroll up Ross!!

Crikeys!

Ross, flippers wont be any threat to you being a buyers agent,

as most people who do a flip, have higher things in mind than a 9-5 job,( or i can imagine a buyers agent would work a lot longer and harder hours)
 
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Attention FLIPPERS !!! Question...?

Reply: 2.2.1.1.1.1.1.1.1.1.2.2
From: Robert Forward


Ross Ross Ross....

These questions have been asked so many times before and answered. How about doing a search on the subject. Your acting like a newbie (no offence to newbies either).

When I flip I'm just telling another human being of an extremely good deal that is on offer. It is up to that Human Being to do Due Diligence and decide on whether to buy or not to buy.

Cheers
Robert
 
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