Aggregation of dutiable transactions
30 Aggregation of dutiable transactions
This section applies to dutiable transactions that together form, evidence, give effect to or arise from what is, substantially 1 arrangement.
For assessing transfer duty on each of the dutiable transactions, the transactions must be aggregated and treated as a single dutiable transaction.Example for subsection (2)—A conducts a business of manufacturing bullbars. A agrees to sell the business to B as a going concern for $50,000,000. The property included in the agreement comprises land, plant and equipment, goodwill and the business name.The land is dutiable property being land in Queensland and each of the other assets are dutiable property being Queensland business assets.The agreement, so far as it relates to the sale of the land, is a dutiable transaction being an agreement to transfer land in Queensland and, so far as it relates to the agreement to sell each of the business assets, is a dutiable transaction being an agreement to transfer dutiable property that is a Queensland business asset. Accordingly, there are 4 dutiable transactions under the agreement.Because the dutiable transactions together form 1 arrangement, they must be aggregated under this section for imposing transfer duty.
For subsection (1), all relevant circumstances relating to the dutiable transactions must be taken into account in deciding whether they together form, evidence, give effect to or arise from what is, substantially 1 arrangement.
For subsection (3), relevant circumstances include the following—
whether the transactions are contained in 1 instrument;
whether any of the transactions are conditional on entry into, or completion of, any of the other transactions;
whether the parties to any of the transactions are the same;
whether any party to a transaction is a related person of another party to any of the other transactions;
the time over which the transactions take place;
whether, before the transactions take place, the dutiable property the subject of the transactions was used together, or dependently with one another, by the transferor or transferors;
whether, after the transactions take place, the dutiable property the subject of the transactions will be used together, or dependently with one another, by the transferee or transferees.
Transfer duty imposed on the dutiable transaction aggregated under this section must—
be assessed on the total of the dutiable values of the transactions when the liability for transfer duty for each of the transactions arose; and
be apportioned between the transactions as decided by the commissioner.
Example for subsection (5)—Under 4 agreements between a builder and a developer, the builder agrees to purchase 4 lots of land from the developer for $100,000 each. The lots are dutiable property being land in Queensland and each of the agreements is a dutiable transaction being an agreement to transfer land in Queensland.Even though the sale of the 4 lots was negotiated at the same time, the agreements were signed on different dates over a 10 month period, had different settlement dates and were not conditional on each other.Under section 24 (Rates of transfer duty) and schedule 3 (Rates of duty on dutiable transactions and relevant acquisitions for landholder and corporate trustee duty), the agreements for lots 1 to 3 have been separately stamped for $2,350 transfer duty. When the agreement for lot 4 is lodged for stamping, the commissioner decides this section applies because the transactions together formed 1 arrangement.Accordingly, the transactions must be aggregated under this section for imposing transfer duty and the duty apportioned between them.Under subsection (5)(a), the total of the dutiable values of the dutiable transactions on which transfer duty is imposed is $400,000, being the value of each of the lots when the liability for transfer duty arose for each of the transactions, regardless of a variation in the values since the liability arose.Under section 24 and schedule 3, transfer duty imposed on the aggregated transaction is $12,475.If the commissioner decides to apportion the transfer duty equally between the dutiable transactions, the amount of transfer duty payable is $3,118.75 for each transaction.Under the Administration Act, part 3, the commissioner will make a reassessment for the transactions for lots 1 to 3. The assessment notice must state the matters mentioned in section 26(2) of that Act.
Each party to each of the dutiable transactions must, when lodging the instrument, ELN transaction document or transfer duty statement relating to the transaction, give notice to the commissioner stating details known to the party about—
all of the dutiable property included or to be included in the arrangement mentioned in subsection (1); and
the dutiable value of each dutiable transaction.
Note—Under the Administration Act, the requirement under this subsection is a lodgement requirement for which a failure to comply is an offence under section 121 of that Act.
This section does not apply to a dutiable transaction to the extent that it relates to an exchange of dutiable property.
This Act’s bill:Explanatory memorandum
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