Abo­li­tion of cer­tain tax­es in NSW

In Brief

After years of delays, it seems that the New South Wales Gov­ern­ment will on 1 July 2016 final­ly make good on its promis­es to abol­ish a raft of duties. Mar­ketable Secu­ri­ties Duty, Busi­ness Assets Duty and Mort­gage Duty, all pre­vi­ous­ly col­lect­ed by the Office of State Rev­enue, will no longer be payable at of the turn of the finan­cial year. 

Facts

The NSW State Gov­ern­ment promised the abo­li­tion of cer­tain duties as a con­se­quence of the intro­duc­tion of the Goods and Ser­vices Tax on 1 July 2000. It now looks almost cer­tain to fol­low through on abol­ish­ing a raft of duties at the turn of the finan­cial year.

Mort­gage Duty, for mort­gages exe­cut­ed on or after 1 July, will not be liable to duty. Also, fur­ther advances made on or after 1 July, irre­spec­tive of the date of the mort­gage, will no longer be liable to duty. Click here for fur­ther mort­gage and caveat relat­ed duty abo­li­tions.

Busi­ness Assets Duty, which is ordi­nar­i­ly payable on the trans­fer of busi­ness assets such as good­will, intel­lec­tu­al prop­er­ty and cer­tain statu­to­ry licences will no longer be payable. For more infor­ma­tion on abo­li­tion of this duty, includ­ing anti-avoid­ance mea­sures, click here.

Mar­ketable Secu­ri­ties (shares and units) Duty, which has been payable for the trans­fer of secu­ri­ties in New South Wales, will be abol­ished from 1 July 2016. For fur­ther infor­ma­tion on abo­li­tion of these and relat­ed duties, on where duty is still payable, as well as anti-avoid­ance mea­sures, click here.

Some anti-avoid­ance mea­sures have been put in place to ensure that a trans­ac­tion which occurred after 1 July was not made or entered into pur­suant to anoth­er arrange­ment pri­or to 1 July with the main pur­pose being to defer the trans­fer or trans­ac­tion to avoid duty. 

What Does This Mean for you?

The deliv­ery of this long held promise by the New South Wales Gov­ern­ment could mean sig­nif­i­cant sav­ings for those enter­ing into trans­ac­tions after 1 July 2016. If you are con­sid­er­ing pur­chas­ing, or sell­ing assets, or have begun such a process, it may be worth seek­ing some advice about the tim­ing of the transaction.