Transfer Duty (Qld)

Stamp duty, known as transfer duty in Queensland, is a tax placed on the value of dutiable property in a transaction. The dutiable value is usually the property’s value on the open market. The tax is collected for the State Government by the Office of State Revenue. It is governed by the Duties Act 2001.

Dutiable property

Dutiable property includes

• land in Queensland;
• a transferable site area (registered, undeveloped land);
• an existing right;
• a Queensland business asset;
• a chattel in Queensland.

It does not include a security interest, a partner’s interest or a trust interest in a property.

When does transfer duty apply?

Transfer duty must be paid when property is bought, sold or transferred. It is charged when:

• property is sold or transferred, or when agreement is made for this;
• a declaration of trust is made over a property;
• dutiable property is surrendered;
• property is claimed under law or buy court order;
• a mortgage is foreclosed;
• there is a new right on a property’s creation, grant or issue;
• a partnership acquisition;
• a property trust is created or terminated;
• a property trust is acquired or surrendered.

A solicitor or conveyancer normally lodges an application for conveyance duty assessment, and arranges for the duty to be paid, as part of a property settlement.

The duty must also be paid when land or an interest in land is acquired without payment, such as via a declaration of trust, a gift, or a change in ownership. A concession or exemption can be available in some circumstances, such as when a person is a beneficiary of a deceased estate or the transfer is between a married or de facto couple.

A solicitor or conveyancer normally lodges an application for stamp duty assessment, and arranges for the duty to be paid, as part of a property settlement.

How is transfer duty calculated?

As with income tax, transfer duty is calculated using a sliding scale. The standard rates are:

Property value

Less than $5000 = nil

More than $5000 up to $75,000 = 1.5% of the value over $5000

More than $75,000 up to $540,000 = $1050 plus 3.5% of the value over $75,000

More than $540,000 up to $1,000,000 =$17,325 plus 4.5% of the value over $540,000

More than $1,000,000 = $38,025 plus 5.75% of the value over $1,000,000

Transfer duty concessions

A transfer duty concession can apply to some transactions, including the transfer of a home or family business.

Home concessions

A concession can be claimed when acquiring a residence, subject to certain requirements. The concession rate applies to the first $350,000 of the value of the property. The duty could be reduced by up to $7175.The person must move into the home within 1 year of acquiring it and not dispose of the home or any part of it within 1 year.

A first home buyer duty concession applies to an existing home valued up to $550,000. The duty could be reduced by up to $15,925. To qualify, the buyer must be aged over 18, have never owned or co-owned property in Australia or overseas, and have never received a first home vacant land concession. The buyer must move into the home within 1 year of buying it, and live there continuously for at least 1 year.

A first home vacant land concession applies to vacant land valued less than $400,000. The duty could be reduced by up to $7175. If the vacant land is valued less than $250,000, no duty is payable. To be eligible for the concession, a person must:

• be aged at least 18;
• have never claimed a first home vacant land concession;
• have never owned or co-owned property in Australia or overseas;
• be paying market value if the land is valued between $320,001 and $399,999;
• build a home on the land and move into it within 2 years of settlement, and not dispose of the home or any part of it within 1 year.

Family business concessions

Transfer duty can be reduced on some business property transactions. A concession is available for primary production businesses transferred to a close relative, and for prescribed businesses that are acquired from a parent or grandparent. The concession applies to the first $500,000 of the value of the property, with duty payable on any value over $500,000.

Transfer duty exemptions

A transfer duty exemption can apply to a range of transactions, such as those outlined below.

Deceased estates

A beneficiary, executor or administrator of a deceased estate does not have to pay transfer duty if the transfer is made under the terms of the will.

Charities

A registered charitable institution can claim an exemption if it acquires property to use solely for a “qualifying exempt purpose” or fundraising. A qualifying exempt purpose includes relieving poverty, caring for the elderly,  the full-time care of children, or religious or educational activities (including kindergartens).

Family transfers

An exemption may be available where the transaction involves a transfer between spouses of an interest in a house, or court orders such as a divorce order or a financial agreement.

Other exemptions

Exemptions can apply to property transactions under other Acts, such as the Industrial Relations Act 1999, the Land Act 1994, the Retirement Villages Act 1999, and the Aboriginal Land Act 1991.

For advice or representation in any legal matter, please contact Armstrong Legal.