Lawcovernotes March 2017

13. b) A strata lot, if it is lawfully occupied as a separate dwelling, or suitable for lawful occupation as a separate dwelling c) A utility lot if its use is restricted to the owner or occupier of a strata lot d) A land use entitlement, if it entitles the holder to occupy a building, or part of a building, as a separate dwelling e) A parcel of vacant land zoned or otherwise designated for use for residential or principally for residential purposes It does not include land for primary production. 7. From 18 July 2016 the purchaser/ transferee declaration must be completed by anyone entering a transaction on or after 21 June 2016 that results in the acquisition of an interest in land in NSW 8. Foreign investors will no longer be entitled to the 12-month deferral for the payment of stamp duty for off-the-plan purchases of residential property Land tax surcharge 1. The land tax surcharge will apply on the taxable value of all residential land owned by a foreigner as at 31 December 2016, including the principal place of residence 2. The surcharge is in addition to the general rate of land tax 3. The land tax surcharge applies even if the property continues to be exempt from the general land tax rate 4. Foreigners will have neither a tax-free threshold for the land tax surcharge, nor an exemption for a principal place of residence Claims prevention tips ^ ^ Carefully consider whether one or more of the purchasers or vendors are “foreign” persons and, if so, whether the surcharge purchaser duty applies to the land or interest being acquired, or to the initial acquisition or holding of any investment ^ ^ If acting for a purchaser, determine whether the land acquired is “residential land”. Also, advise the purchaser on the effect of the surcharge purchaser duty on the purchase price and the transaction structure more generally ^ ^ Ensure duty and the surcharge purchaser duty are paid within three months of the transfer of dutiable property ^ ^ Ensure completion of the purchaser/transferee declaration by anyone entering a transaction on or after 21 June 2016 ^ ^ Consider whether the transaction is exempt from the surcharge purchaser duty ^ ^ Advise purchasers of the long-term holding costs for residential land ^ ^ Make detailed file notes of all conversations with the client and send detailed letters of advice confirming your instructions and advice Further information ^ ^ For further information see the Office of State Revenue website Milica Milutinovic Claims Solicitor