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Land transfer duty waiver – VIC

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The Victorian Government has announced a land transfer duty waiver for purchases of Victorian residential property with a dutiable value of up to $1 million.

For new residential properties, a 50% duty waiver applies. For existing residential properties and vacant residential land, a 25% duty waiver applies.

The applicable waiver is applied to the duty otherwise payable after all other eligible benefits, such as the first home buyer duty concession, the principal place of residence concession and the pensioner concession, have been taken into account.

The waiver can apply to the purchase of an investment property. There is no requirement to live in the property.

The waiver can be applied for more than once.

While a foreign person can obtain the waiver, it does not apply to foreign purchaser additional duty.

To be eligible for this waiver:

  • the purchase must be of residential property;
  • dutiable value must be $1 million or less;
  • the contract must be signed on or after 25 November 2020 and before 1 July 2021; and
  • the arrangement must be a bona fide purchase for adequate consideration i.e. not a gift.

The State Revenue Office will apply the waiver automatically if all eligibility criteria are met based on the information provided in the Digital Duties Form.

For further information, see the State Revenue Office page Land transfer duty waiver for residential property transactions of up to $1 million.

The By Lawyers Conveyancing – Purchase of real property (VIC) Guide has been updated accordingly.

1 January updates – All states

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The By Lawyers has attended to the following 1 January updates required by legislation and practice in all relevant jurisdictions:

Land tax – Increases to threshold values – NSW

Land tax thresholds in NSW are indexed to rise on 1 January each year.

The 2021 threshold combined land value has increased to $755,000 for all liable land. Special trusts and non-concessional companies are excepted.

A marginal tax rate of 1.6% of the aggregate taxable value above the tax-free threshold plus $100 applies.

If the aggregate taxable value exceeds the premium rate threshold of $4,616,000 then $60,164 is payable plus a marginal tax rate of 2% over that amount.

All relevant commentary and precedents in the By Lawyers Conveyancing & Property and Trusts guides have been updated accordingly.

By Lawyers Contract for sale of land

The 2021 edition is now available on the Sale of real property matter plan in the Contract section.

Leases and subleases – NSW, VIC, QLD, SA and WA

The 2021 editions are now available on the Leases – Act for Lessor matter plan for each jurisdiction.

These additions form part of our continuing commitment to enhancing our content and helping our subscribers enjoy practice more.

Bankruptcy

In response to the COVID-19 pandemic temporary changes were made to bankruptcy law, increasing the debt threshold to $20,000 from $5,000 and increasing the time frame for a debtor to respond to a bankruptcy notice to 6 months from 21 days.

As of 1 January 2021 these changes have ceased and a new permanent bankruptcy threshold has been implemented.

The current debt requirement for bankruptcy is a minimum debt of $10,000 and the current time to respond to a bankruptcy notice is 21 days.

The By Lawyers Insolvency – Bankruptcy of individuals publication has been updated accordingly.

Always up to date

In addition to our annual 1 January updates, By Lawyers ensures our publications are updated for 1 June and any other statutory or regulated adjustments where necessary. We also promptly  update our content for all relevant legislative amendments and other legal developments throughout the year, in all jurisdictions.

The team at By Lawyers wishes everyone a prosperous and safe 2021.

Retirement Villages (NSW) – Amendments

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Retirement Villages Amendment Act 2020

The Retirement Villages Amendment Act 2020 has introduced significant changes to exit entitlements, recurrent charges and has enhanced the rights and safeguards of registered interest holders.

Recognising that more than 60% of retirement village residents directly transition into aged care accommodation and that the average age of a person entering a retirement village is 75 and the average age of residents is 81 and more people will be moving into aged care accommodation, the Retirement Villages Amendment Act 2020 address the easing of the financing of the transition.

Most notably, the Act has amended the Retirement Villages Act 1999:

  • to enable the Secretary of the Department of Customer Services to make an order requiring an operator to pay a resident the amount the resident will be entitled to once their residential premises are sold – the exit entitlement – in circumstances where the resident has moved out or intends to move out, and the premises have not yet been sold.
  • To require an operator to pay part of the resident’s exit entitlement directly to an aged care facility in which the resident resides or proposes to reside as payment for accommodation in the facility, instead of paying the exit entitlement to the resident, in circumstances where the premises in the retirement village have not yet been sold.
  • To provide that a former resident of residential premises in a retirement village is not required to pay recurrent charges to the operator of the retirement village once 42 days have passed since the former resident permanently vacated the premises.

The By Lawyers Retirement Villages (NSW) Guide has been updated accordingly. This guide is available within the Conveyancing (NSW) publication.

Contract of sale of land – By Lawyers VIC 2021 version

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Conveyancing practitioners should be aware that the Contract of sale of land – By Lawyers VIC 2021 version has now been published.

The contract is available to LEAP users with the By Lawyers integration and to non-LEAP users by subscription to the Conveyancing (VIC) publication. The contract can be found in the Sale of Real Property (VIC) guide. The contract is also available for purchase through InfoTrack.

The contract was co-authored by Victorian property law guru and long-time By Lawyers author Russell Cocks. For more information about the By Lawyers contract listen to the podcast Seven reasons to use the By Lawyers Contract of sale of land.

The By Lawyers Contract of sale of land for Victoria was introduced on 1 March 2018 and its use has been increasing steadily among Victorian legal practitioners and conveyancers. The contract removes the need for special conditions other than those covering special circumstances and has a number of other advantages over the LIV contract which further simplify the conveyancing process.

Additions to the Contract of sale of land – Parts 1 and 2 – By Lawyers VIC 2021 version

  • GST provisions in the Particulars section of Part 1 have been amended for clarity.
  • An option of 14 OR 21 days has been added in relation to the loan approval period.
  • Clause 14 of the General Conditions has been amended to provide the purchaser with the ability to request an extension of time to obtain loan approval, sets out the corresponding options for the vendor, and provides for the outcome where the vendor fails to respond to the extension request in time.
  • Clause 15 has been amended to provide for the rectification of any error made in the calculation of adjustments that is discovered after completion.
  • Clause 22 clarifies that where the property is subject to the Retail Leases Act 2003, the vendor must provide the purchaser with a copy of the disclosure statement.

Rest assured that the By Lawyers contract is immediately brought up to date with any changes in law or practice.

HomeBuilder – FED

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The Federal Government has announced an extension to the HomeBuilder scheme to 31 March 2021, however the grant amount has been reduced to $15,000. The $25,000 grant is still available, with amended eligibility criteria, for building contracts signed on or before 31 December 2020.

HomeBuilder $25,000 grant

For building contracts signed between 4 June 2020 and 31 December 2020, a $25,000 grant is available to certain individuals who build a new home or buy an off the plan home, or substantially renovate an existing home. The grant cannot be used to buy an existing house and is limited to Australian citizens earning less than $125,000 or couples earning less than $200,000.

The value of new builds is capped at $750,000. For renovations, the home must be worth less than $1.5 million before the renovation, and projects must cost between $150,000 and $750,000.

The building contract must be signed between 4 June 2020 and 31 December 2020, and work must commence within six months of the contract date.

Applications must be submitted by 14 April 2021.

HomeBuilder $15,000 grant

For building contracts signed between 1 January 2021 to 31 March 2021, a $15,000 grant is available to certain individuals who build a new home or buy an off the plan home, or substantially renovate an existing home. The grant cannot be used to buy an existing house and is limited to Australian citizens earning less than $125,000 or couples earning less than $200,000.

The value of new builds is capped at $950,000 for NSW, $850,000 for VIC and $750,000 for all other States and Territories. For renovations, the home must be worth less than $1.5 million before the renovation, and projects must cost between $150,000 and $750,000.

The building contract must be signed between 1 January 2021 and 31 March 2021, and work must commence within six months of the contract date.

Applications must be submitted by 14 April 2021.

State-based grants

On top of the HomeBuilder scheme, some states are offering related payments in addition to the Federal grant. See the relevant By Lawyers Conveyancing – Purchase Guide for further information and relevant application forms or links where applications are made online.

All By Lawyers Conveyancing – Purchase Retainer instructions precedents now also include these grant details.

101 Costs Answers – ALL STATES

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101 Costs Answers is the latest addition to the By Lawyers ‘101’ series of helpful reference materials.

Located in the Reference materials folder on every By Lawyers matter plan, this publication contains valuable commentary and precedents on all aspects of legal costs.

The precedents include all of the By Lawyers costs agreements/client services agreements and costs disclosures, drawn together from all By Lawyers publications into a convenient single publication.

The By Lawyers costs agreements are compliant with the strict requirements of the various state laws. They cater for all areas of law, with detailed recitals of the scope of work usually undertaken in each type of matter. This not only defines the retainer but makes it easy for practitioners to produce documents quickly upon engagement.

The 101 Costs Answers commentary includes:

Disclosure requirements

The commentary helps practitioners to navigate some of the more complicated disclosure requirements including regulated costs and the specific obligations for different types of litigation matters. The effect of non-disclosure is also covered.

Disbursements

Commentary on defining and recovering disbursements includes relevant case law and examples. The By Lawyers costs agreements are drafted to clearly identify usual disbursements.

Counsel’s fees

The commentary deals with the contractual relationship between solicitors and barristers as well as disclosure requirements. With the solicitor responsible for payment of counsel’s fees regardless of the solicitor’s agreement with the client, the By Lawyers costs agreements include counsel’s fees as specific disbursements which the client is obliged to pay.

Debt recovery

Where debt recovery is necessary, 101 Costs Answers contains letters of demand and example pleadings to assist with the recovery of costs. There is also detailed commentary on costs assessment procedures and the relevant forms for each state are available on the matter plan.

Like all By Lawyers publications, 101 Costs Answers contains interactive links to relevant legislation and cases, which are always kept updated.

Contract of sale of land – VIC

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Conveyancing practitioners would be aware the By Lawyers Contract of sale of land – VIC 2020 is available to website subscribers and LEAP users. The contract is available, at no extra charge to subscribers, in the VIC Conveyancing – Sale of real property publication. The contract was co-authored by Victorian property law guru and long-time By Lawyers author Russell Cocks.

For more information about the By Lawyers contract listen to the podcast Seven reasons to use the By Lawyers Contract of sale of land.

In response to requests from subscribers for greater flexibility when preparing and compiling the By Lawyers Contact of sale of land, the s 32 Vendor statement has been separated out from the contract for those who prefer it so. The following individual precedents have been added to the VIC Conveyancing – Sale of real property matter plan:

  • Contact of sale of land – Part 1 of 2 – Particulars – By Lawyers VIC 2020
  • Section 32 Vendor Statement – By Lawyers VIC
  • Due diligence checklist for home and residential property buyers – Consumer Affairs Victoria

The original precedent Contract of sale of land, with the s 32 Vendor statement included, remains available.

Electronic conveyancing – SA

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From 3 August 2020, electronic conveyancing takes a big step forward in South Australia.

From that date, electronic lodgement of the following documents with Land Services SA will be mandatory:

  • Transfer
  • Caveat
  • Withdrawal of Caveat
  • Encumbrance
  • Discharge of Encumbrance
  • Transmission Application
  • Application to Register Death by Survivor
  • Lease
  • Surrender of Lease
  • Underlease
  • Surrender of Underlease
  • Transfer of Mortgage
  • Transfer of Encumbrance.

There are now two Electronic Lodgement Network Operators (ELNOs) active in South Australia – Sympli and PEXA. Sympli have been approved for transfers, caveats, withdrawal of caveats, mortgages and discharge of mortgages in SA. Practitioners can use either or both for their electronic conveyancing requirements.

 

HomeBuilder scheme

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From 4 June 2020, a $25,000 grant is available to certain individuals who build a new home or substantially renovate an existing home. The grant cannot be used to buy an existing house and is limited to Australian citizens earning less than $125,000 or couples earning less than $200,000.

The value of new builds is capped at $750,000. For renovations, the home must be worth less than $1.5 million before the renovation, and projects must cost between $150,000 and $750,000.

The building contract must be signed between 4 June 2020 and 31 December 2020, and work must commence within three months of the contract date.

Applications will be through the relevant revenue department once the necessary agreements have been signed by the State and Commonwealth Governments.

The By Lawyers Purchase Guides have been updated accordingly.

Land tax changes – SA

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Land tax changes apply from midnight 30 June 2020. There will be an increase in the general land tax threshold to $450,000 and a threshold of $25,000 will be introduced for trust ownership.

Current land tax rates and thresholds are available on the RevenueSA Rates and Thresholds page.

Land tax changes – joint owners

From the 2020-21 financial year, changes apply to how land tax is assessed for owners who own land in multiple ownership.

Pursuant to s 9(4) of the Land Tax Act 1936, joint owners of land will receive a land tax assessment for the jointly owned land where the value of that land is above the taxable threshold.

Pursuant to s 9(6), if an owner of jointly owned land also owns, or is deemed to own, other parcels of land in their own right, they may receive a separate assessment for their total landholdings which will include their share of the jointly owned land. The share of jointly owned land will also be combined with the site values of any land owned as an individual to calculate land tax payable.

A deduction will be applied to the individual assessment, which relates to the proportion of land tax assessed for the share in the joint ownership.

For further information, see the RevenueSA Owning land in multiple ownerships page.

The By Lawyers Conveyancing (SA) Publication has been updated accordingly.

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