Duties Act 1997

This Act is the Duties Act 1997.

This Act commences on 1 July 1998.

This Act creates and charges a number of duties.

Note.

Each duty is dealt with in a separate Chapter of this Act. The Contents pages list the Chapters and their subject-matter.

A duty charged by this Act is, when a liability to pay the duty is created, a debt due to the State of New South Wales.

This Act does not contain all the provisions concerning duties. This Act is to be read together with the Taxation Administration Act 1996. The Taxation Administration Act 1996 contains provisions that deal with, for example—

• how assessments of duty are made

• how assessments can be challenged

• what happens if duty is not paid on time

• how unpaid duty may be recovered

• what records must be kept by taxpayers

• how decisions made under this Act can be challenged

• the investigative powers of tax administrators.

For this Act, each sub-fund of a CCIV is taken to be a unit trust scheme of which—

the CCIV is the trustee, and

the business, assets and liabilities of the sub-fund are the trust property, and

the members of the sub-fund are the beneficiaries.

For a sub-fund that is taken to be a unit trust scheme—

a share in the CCIV that is referable to the sub-fund is taken to be a unit in the unit trust scheme, and

a shareholder of the share, as a member of the sub-fund, is taken to be a registered unit holder of the unit in the unit trust scheme, and

the rights, entitlements, obligations and other characteristics attaching to the share are taken, as far as practicable, to be the same rights, entitlements, obligations and other characteristics attaching to the unit, and

a winding up of the sub-fund is taken to be a winding up of the unit trust scheme, and

a person who has an entitlement to a distribution of property in the event of the distribution of all the property of the sub-fund is taken to have the same entitlement to a distribution of property in the event of the distribution of all the property of the unit trust scheme.

For this Act, a CCIV is taken to be a separate person in relation to each unit trust scheme of which it is the trustee under subsection (1).

This Act does not apply to a CCIV or the members of a sub-fund of a CCIV except as provided for by this section.

Words and expressions used in this Act (or in any particular provision of this Act) that are defined in the Dictionary at the end of this Act have the meanings set out in the Dictionary.

Notes included in this Act are explanatory notes and do not form part of this Act.

This Chapter charges duty on—

a transfer of dutiable property, and

the following transactions—

an agreement for the sale or transfer of dutiable property,

a declaration of trust over dutiable property,

a surrender of an interest in land in New South Wales,

a foreclosure of a mortgage over dutiable property,

a vesting of dutiable property by or as a consequence of an order of a court of this or another jurisdiction, whether inside or outside Australia,

the enlargement of a term in land into a fee simple under section 134 of the Conveyancing Act 1919,

a vesting of land in New South Wales by, or expressly authorised by, statute law of this or another jurisdiction, whether inside or outside Australia,

a lease in respect of which a premium is paid or agreed to be paid,

another transaction that results in a change in beneficial ownership of dutiable property, other than an excluded transaction.

(Repealed)

Note.

There are other provisions in this Act that deem certain transactions to be a transfer of dutiable property under this Chapter, for example—

section 9A, which provides for certain circumstances in which a transfer of a partnership interest is taken to occur, and

section 9B, which provides for certain circumstances in which a transfer of an option to purchase land is taken to occur, and

section 9C, which provides for circumstances in which a novation of an agreement for the lease of land in New South Wales is taken to be a transfer of dutiable property, and

Part 2 of Chapter 3, which treats a transfer or assignment of an option to purchase dutiable property as a transfer of the dutiable property in certain circumstances.

Such a transfer or transaction is a dutiable transaction for the purposes of this Act.

Despite subsection (1)(b)(ix), an excluded transaction that results in a change in beneficial ownership of dutiable property is a dutiable transaction if it is part of a scheme or arrangement that, in the Chief Commissioner’s opinion, was made with a collateral purpose of reducing the duty otherwise chargeable under this Chapter.

In this Chapter—

beneficial ownership includes ownership of dutiable property by a person as trustee of a trust.

change in beneficial ownership includes the following—

the creation of dutiable property,

the extinguishment of dutiable property,

a change in equitable interests in dutiable property,

dutiable property becoming the subject of a trust,

dutiable property ceasing to be the subject of a trust.

declaration of trust means any declaration (other than by a will or testamentary instrument) that any identified property vested or to be vested in the person making the declaration is or is to be held in trust for the person or persons, or the purpose or purposes, mentioned in the declaration although the beneficial owner of the property, or the person entitled to appoint the property, may not have joined in or assented to the declaration.

excluded transaction means the following—

the purchase, gift, allotment or issue of a unit in a unit trust scheme,

the cancellation, redemption or surrender of a unit in a unit trust scheme,

the abrogation or alteration of a right relating to a unit in a unit trust scheme,

the payment of an account owing for a unit in a unit trust scheme,

the grant, renewal or variation of a lease for no consideration,

the grant of an easement for no consideration,

the grant of a profit a prendre for no consideration,

the provision of a security interest within the meaning of the Personal Property Securities Act 2009 of the Commonwealth,

a change in a trustee’s right of indemnity,

the creation of an interest in dutiable property by statute,

a transaction of a kind prescribed by the regulations,

a combination of the transactions referred to in paragraphs (a)–(k).

lease means a lease of land in New South Wales or an agreement for a lease of land in New South Wales.

premium, in respect of a lease entered into pursuant to an option, includes an amount paid or payable for the grant of the option.

transfer includes an assignment, an exchange and a buy-back of shares in accordance with Division 2 of Part 2J.1 of the Corporations Act 2001 of the Commonwealth.

This Chapter also charges duty on the making of a statement that—

purports to be a declaration of trust over dutiable property, but

merely has the effect of acknowledging that identified property vested, or to be vested, in the person making the statement is already held, or to be held, in trust for a person or purpose mentioned in the statement.

For the purpose of charging the duty—

the making of the statement is taken to be a declaration of trust over dutiable property and, accordingly, is a dutiable transaction, and

the property vested, or to be vested, in the person making the statement is taken to be the property transferred, and

the person making the statement is taken to be the transferee, and

the transfer is taken to occur when the statement is made.

Without limiting section 8 (1) (b) (vii), land in New South Wales is vested under statute law if the law vests the land in an entity that the law states is the successor in law of, continuation of or same entity as, the entity in which the land was previously vested.

However, land in New South Wales is not vested under statute law on the registration of a company under Part 5B.1 of Chapter 5B of the Corporations Act 2001 of the Commonwealth.

The merger of a corporation (company A) with and into another corporation (company B) in circumstances where neither subsection (4) nor subsection (5) applies is taken to be a vesting of the land in New South Wales of company A in company B by statute law.

A merger of corporations (the merging corporations) in circumstances where another corporation (company C) results as a consequence of the merger is taken to be a vesting of the land in New South Wales of the merging corporations in company C by statute law.

A merger of corporations (the merging corporations) with and into each other in circumstances where each of the merging corporations continues in existence is taken to be a vesting in the merging corporations, jointly, of 50% (in value) of the land in New South Wales of the merging corporations by statute law.

A division of a corporation (the dividing corporation) in circumstances where the dividing corporation does not continue in existence and 2 or more other corporations (the new corporations) result as a consequence of the division is taken to be a vesting in each new corporation by statute law of the land in New South Wales of the dividing corporation that is held by the new corporation as a result of the division.

A division of a corporation (the dividing corporation) in circumstances where the dividing corporation continues in existence and 1 or more other corporations (the new corporations) result as a consequence of the division is taken to be a vesting in each new corporation by statute law of the land in New South Wales of the dividing corporation that is held by the new corporation as a result of the division.

The duty charged by this Chapter on a dutiable transaction referred to in section 8 (1) (b) is to be charged as if each such dutiable transaction were a transfer of dutiable property.

Accordingly, for the purpose of charging duty under this Chapter, in relation to a dutiable transaction specified in Column 1 of the following Table—

the property specified opposite the dutiable transaction in Column 2 is taken to be the property transferred (and a reference in this Act to property transferred includes a reference to such property), and

the person specified opposite the dutiable transaction in Column 3 is taken to be the transferee of the dutiable property (and a reference in this Act to a transferee includes a reference to such a person), and

the transfer of the dutiable property is taken to have occurred at the time specified opposite the dutiable transaction in Column 4 (and a reference in this Act to the time at which a transfer occurs includes a reference to such a time).

Table

Column 1

Column 2

Column 3

Column 4

Dutiable transaction

Property transferred

Transferee

When transfer occurs

agreement for sale or transfer

the property agreed to be sold or transferred

the purchaser or transferee

when the agreement is entered into

declaration of trust

the property vested or to be vested in the declarant

the person declaring the trust

when the declaration is made

surrender

the surrendered property

the person to whom the property is surrendered

when the surrender takes place

foreclosure

the mortgaged property

the mortgagee

when the foreclosure order is made

vesting by court order

the vested property

the person in whom the property is vested

when the order is made

enlargement of a term in land into a fee simple

the estate in fee simple

the person who acquires the estate in fee simple

when the term is enlarged

vesting by statute law

the vested land in New South Wales

the person in whom the land is vested

when the vesting by statute law occurs

lease

the leased property

the lessee

when the lease is entered into

another transaction that results in a change in beneficial ownership of dutiable property

the property the beneficial ownership of which is changed

the person who obtains the beneficial ownership or whose beneficial ownership is increased

when beneficial ownership changes