ByLawyers News and Updates

First home – WA

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First home owner and off-the-plan duty changes

Changes have been introduced to the value caps for vacant land and established homes in WA that qualify for the first home owner concessional rate of duty, along with measures to extend and expand the off-the-plan duty concession.

The changes apply to transactions entered into from 21 March 2025.

RevenueWA expects to configure its systems to apply the new rates in early May 2025. Any eligible transactions entered into on or after 21 March 2025 that settle before the changes are implemented can be reassessed for a refund of duty after settlement.

Transfer duty – First home

First home owners buying an established or new home, or buying vacant land and then entering onto a contract to build a home on it and receiving a first home owners grant, can apply to be assessed at the first home owner rate of duty.

When the unencumbered value of a first home in Perth and Peel is:

  • up to $500,000 – no duty is payable;
  • between $500,001 and $700,000 – $13.63 per $100, or part thereof, above $500,000 is payable;
  • over $700,000 – full duty is payable, and no reduced rate applies.

When the unencumbered value of a first home in regions outside Perth and Peel is:

  • up to $500,000 – no duty is payable;
  • between $500,001 and $750,000 – $11.90 per $100, or part thereof, above $500,000 is payable;
  • over $750,000 – full duty is payable, and no reduced rate applies.

When the unencumbered value of vacant land purchased by an eligible first home buyer anywhere in WA, is:

  • up to $350,000 – no duty is payable;
  • between $350,001 and $450,000 – $15.39 per $100, or part thereof, above $350,000 is payable;
  • over $450,000 – full duty is payable, and no reduced rate applies.

Off the plan duty concession

For new off-the-plan homes within strata developments:

  • the expiry date of the existing duty concession is extended from 30 June 2025 until 30 June 2026;
  • no duty is payable for dwellings purchased before construction has commenced up to $750,000, with a 50% duty concession for properties valued above $850,000; and
  • a 75% duty concession is available for dwellings purchased while under construction up to $750,000, with a 37.5% duty concession for properties valued above $850,000.

This applies to all dwellings within strata and community title schemes, including townhouses and villas, not just multi-tiered developments.

Publication updates

The By Lawyers Purchase of Real Property (WA) guide has been updated, including the commentary and the Retainer Instructions – Purchase of Real Property.

 

Revenue – NSW

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Recent duty and other revenue amendments impacting conveyancing, trusts, and family law have been incorporated as applicable into the relevant By Lawyers publications.

Legislation

The State Revenue and Fines Legislation Amendment (Miscellaneous) Act 2022 (NSW) amended various revenue Acts with effect from 19 May 2022, including:

These revenue amendments touch on various areas of practice.

Conveyancing

Options

Ad valorem stamp duty is payable on option fees under put and call option deeds. New section 8 (1)(b)(ix) of the Duties Act 1997 provides that duty is payable by the grantee within three months of an option being granted. This changes the previous position where duty was only payable on an option fee if the option was exercised.

Duty is assessed on the option fee, not including security deposits, performance payments, and legal costs.

The grantee is not entitled to claim a refund for any stamp duty paid, regardless of whether the call option is exercised. Also duty paid on the option fee is not credited toward the duty payable on the property when the option is exercised and the contract completed.

The changes do not apply to option agreements entered into before 19 May 2022.

Off the plan

A new section 49A (1D) of the Duties Act 1997 provides that to qualify for a 12-month deferral of stamp duty on off-the-plan purchases, a residence requirement must be met. At least one of the purchasers must use and occupy the property as their principal place of residence for at least 6 months, within 12 months of completion. Australian Defence Force personnel are exempted from the residency requirement. A new version of the Revenue NSW purchaser declaration form is available. Part 6 of the form relates to off-the-plan purchases and provides for the nomination of ADF personnel.

Surcharge duty

A new s 104ZJA(1) (c) of the Duties Act 1997 provides that an Australian-based developer which pays surcharge purchaser duty on a transfer of residential land may have it refunded they later change the use of the land to wholly or predominantly commercial or industrial.

The application for a refund must be lodged online using the application type Australian Based Developer Application for Exemption & Reassessment.

First home owners

Section 13A (3) of the First Home Owner Grant (New Homes) Act 2000 has been amended to include a new definition of the eligibility cap, including how to calculate the total value of the transaction based on the type of transaction and when it occurs.

Land tax

New sections 5B(2A) and 5B(2B) of the Land Tax Act 1956 provide for a discretionary exemption allowing those who do not occupy their principal place of residence for 200 days continuously in a year to remain exempt from land tax. This allows owners to, for example, live and work overseas for a period without losing the exemption.

The By Lawyers Sale of real property (NSW), Purchase of real property (NSW) and 1001 Conveyancing Answers (NSW) publications have been updated accordingly.

Trusts

The amending Act broadens the scope of dutiable transactions under s 8(1)(b)(ix) of the Duties Act 1997 by introducing duty on transactions that result in a change in beneficial ownership and acknowledgement of trust. 

Under s 8(3), the definition of change in beneficial ownership has been extended to include the creation and extinguishment of dutiable property, a change in equitable interests in dutiable property, and dutiable property becoming and ceasing to be subject to a trust.

This amendment directly arises from the case of Benidorm Pty Ltd v Chief Commissioner of Revenue [2020] NSWSC 471 where the Supreme Court held that the definition of declaration of trust in s 8(3) of the Duties Act 1997  as it then was must have a legal consequence, or consequences, beyond merely acknowledging that which already exists. The taxpayer in that case held real property and shares on trust for a beneficiary. When the beneficiary died his sole beneficiary and executor made a declaration of trust substantially the same as the original trust. On appeal the taxpayer was successful and was able to avoid paying duty on the second declaration, which acknowledged and evidenced a trust that was already in place. Such an acknowledgment of trust will now be caught by the Act.

The By Lawyers Trusts publication has been updated accordingly.

Family Law

A new s 68 (1A)(b)(iia) of the Duties Act 1997 means that for de facto relationships transfers of property effected by an agreement made to divide relationship property due to the breakdown of a relationship will be exempt from duty. Previously, to be exempt from duty the transfer had to be effected by a binding financial agreement, court order, or purchase at a public auction. This brings the exemption for de facto couples into line with that for married couples. These exemptions are discretionary and depend on sufficient evidence being supplied in support of the application.

A new version of the form Revenue NSW ODA 069 – Application for Exemption or Refund – Break up of marriage or De facto Relationship is available and needs to be completed.

The By Lawyers 101 Family Law Answers publication has been updated accordingly.

Transfer by direction – SA

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Requirements for a transfer by direction have been relaxed in SA.

A recent Revenue Ruling SDA009[V2] states that, unless additional consideration is being paid by the transferee, a Deed of Assignment or Nomination is no longer necessary for any purchaser to direct the vendor to transfer the property to any other person or entity – whether related or not.

The Ruling states that Revenue SA:

  • acknowledges that a purchaser named in a contract has a common law right to direct the vendor to transfer the land to any party the purchaser chooses. This common law right to a transfer by direction exists whether or not the purchaser executes the contract with “and/or nominee”; and
  • no longer requires a letter of agency/nomination, nor any formal assignment, where a purchaser named in a contract and the person named in the transfer pursuant to that contract are not the same.

However, stamp duty will still be payable where an assignment document is prepared and executed, or when Section 68 of the Stamp Duties Act 1923 applies.

The ruling contains an example direction to the vendor.

The Sale and Purchase commentaries in the by Lawyers SA Conveyancing publication have been updated accordingly.

Purchase – VIC – Additional foreign purchaser land transfer duty exemption

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Information on this new exemption has been added to the Purchase commentary and 1001 Conveyancing Answers (VIC).

From 1 July 2018 additional duty will only apply to a contract or transaction for residential property for a foreign transferee where the following exemption criteria is not met:

  • The purchase of the residential property is completed jointly with a spouse or domestic partner who is an Australian citizen, permanent resident, or New Zealand citizen who holds a special category visa; and
  • The property will be used as their principal place of residence for a continuous period of 12 months, starting within 12 months of them becoming entitled to possession of the property.

This exemption is available for transfers from 14 June 2018.

 

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