When is QLD stamp duty payable?

[Ian (WA)]

G'day All,

I have an acquaintance who is about to be hit for penalty rates on non payment of stamp duty on the transfer of land for a property purchase he is making in Qld.

He has arranged an extended settlement of some 6 months, but he has been told by his solicitor and the office of State Revenue that stamp duty on the transfer of land is payable as soon as the contract to buy goes unconditional. As settelement has not taken place yet, the penalty rates kick in effective from today.

This does not sound correct to me.........your thoughts please.

Cheers,

Ian.

 

[urban cowboy]

I am no solicitor and may be wrong...but I was of the opinion that transfer duty (formally known as stamp duty) was payable within 30 days of a transfer of ownership OR an AGREEMENT to transfer ownership.

actually, just found this link:
http://www.osr.qld.gov.au/forms_pub...dutiable_transactions_dutiable_property07.pdf

more or less backs up what I just said.

 

[boomtown]

When does transfer duty became payable on the purchase of property? See section 16 of the Duties Act 2001. Parties liable to pay transfer duty must lodge the instrument within 30 days after execution. Once an assessment is made, the duty is payable by the due date on the assessment notice, generally 30 days after the issue date of the assessment.

http://www.osr.qld.gov.au/taxes/duties/faq/transfer/faq_transfer_general.shtml

 

[Ian (WA)]

Thanks BT & UC,

So to clarify.....once a contract to buy a property is signed by both parties it is considered as 'executed' and therefore transfer duty is payable within 30 days.

In essence you can have settlement in 6 months time if you want but you have to pay transfer duty pretty well straight away, regardless of settlement date.

That sucks!!

If this is incorrect please slap me.

Cheers,

Ian.

 

[sunshine]

That sucks!!

Yup sure does. We have found ourselves in the same boat with a six month settlement. We have chosen to go the penalty interest even though it could possibly go over $1k.

Sunshine

 

[urban cowboy]

that's the way i understand it mate...

you can have a three year settlement - but transfer duty i due within 30 of contract unless you have the exemptions.

that is very simplistic and there is a lot more to it - but for the purposes of a simple statement etc.

cheers
UC

 

[Ian (WA)]

G'day All,

Thanks for the replies everyone.

Just played around with the calculator on the OSR site and threw in a nominal $800,000 purchase price and payment 6 months after due date so penalty interest of $1106. Not real pleasant, but if it gives you the six months to settle on the place then it's all relative I suppose even if it's at 15.7%!!

I don't know if it's about to be adopted elsewhere around the country but I know I haven't seen this before in SA or WA.

Cheers,

Ian.

 

[boomtown]

Be careful.

OSR is likely to be very unhappy with you if they find out that you are treating penalty interest as a cost of business.

If this, for example, becomes a pattern of behaviour, they may bring other action against you.

Better just to pay on time.

 

[Ian (WA)]

Thanks BT......I believe my friend will be paying transfer duty this coming week, if he hasn'yt already. Your point though is taken onboard as I will be buying in Hervey Bay shortly myself.

Cheers, Ian.