State Taxation Acts Amendment Act 2008

State Taxation Acts Amendment Act 2008

No. 31 of 2008

table of provisions

SectionPage

Part 1—Preliminary

1Purpose

2Commencement

Part 2—Duties Act 2000

3What is the consideration for the transfer of dutiable property?

4New sections 21A to 21E inserted

21ACommissioner may publish percentage

21BRecords to be kept

21CPeriod of retention

21DPower to require documents

21EJoint and several liability for additional duty

5Increase in thresholds for general rate of duty

6Provisions for determining consideration

7Property passing to unitholders in unit trust schemes

36BProperty passing to unitholders in unit trust schemes

8New section 38A inserted

38ASpecial disability trusts

9Increase in principal place of residence concession

10Increase in eligible pensioner concession

11Consequential amendments to first home owner concession

12New Division 1B inserted in Part 2 of Chapter 11

Division 1B—Exchange of stapled ownership interests for ownership interests in a unit trust scheme

250DHDefinitions

250DIExemption for relevant acquisitions

250DJConditions of exemption

250DKRevocation of exemption

13Tax assessment, penalty and interest regarding rollovers

14New clause 27 of Schedule 2 inserted

27State Taxation Acts Amendment Act 2008

Part 3—First Home Owner Grant Act 2000

15Additional grant for newly constructed homes in regional Victoria

16New Schedule 1 inserted

SCHEDULE 1—Municipal Councils in Regional Victoria

Part 4—Land Tax Act 2005

17Special land tax

18New section 76A inserted

76AResidential services for people with disabilities

19Increase in thresholds and reduction in top tax rate

Part 5—Payroll Tax Act 2007

20Exemption for non-profit organisations

21Groups of corporations

22New section 74 substituted

74Smaller groups subsumed by larger groups

23Registration

24Leap years

25Reduction in payroll tax rate

26New clause 15 inserted in Schedule 3

15State Taxation Acts Amendment Act 2008

27Statute law revision

Part 6—Repeal of Amending Act

28Repeal of Act

═══════════════

Endnotes

SectionPage

Victoria

SectionPage

State Taxation Acts Amendment Act 2008[†]

No. 31 of 2008

[Assented to 17 June 2008]

State Taxation Acts Amendment Act 2008
No. 31 of 2008

The Parliament of Victoriaenacts:

Part 6—Repeal of Amending Act

State Taxation Acts Amendment Act 2008
No. 31 of 2008

Part 1—Preliminary

1Purpose

The purpose of this Act is—

(a)to amend the Duties Act 2000—

(i)to increase thresholds for general duty and for principal place of residence and pensioner concessions;

(ii)to remove the election between the principal place of residence concession and the first home owner bonus;

(iii) to introduce further duty exemptions;

(iv) to provide greater certainty in relation to the calculation of duty for properties that are sold off the plan;

(v) to clarify that certain transactions concerning dutiable property subject to unit trust schemes are exempt from duty where there is no change in beneficial ownership of property;

(b) to amend the First Home Owner Grant Act 2000 to give an additional grant to first homebuyers purchasing a newly constructed home in regional Victoria;

(i)to increase thresholds and reduce the top land tax rate;

(ii)to introduce a further land tax exemption;

(d) to amend the Payroll Tax Act 2007 to reduce the rate of payroll tax, clarify certain provisions and ensure continued consistency with New South Wales.

2Commencement

s. 2

(1)This Act, other than Part 3 and sections 5, 8, 9, 10, 11, 12, 13,17(2), 20, 21, 22 and 23, comes into operation on the day after the day on which it receives the Royal Assent.

(2)Part 3 and sections 5, 8, 9, 10 and 11 are deemed to have come into operation on 6 May 2008.

(3) Sections12, 13, 20, 21, 22 and 23come into operation on 1 July 2008.

(4) Section 17(2) comes into operation on 1 January 2009.

s. 2

______

Part 2—Duties Act 2000

3What is the consideration for the transfer of dutiable property?

s. 3

See:
Act No.
79/2000.
Reprint No. 6
as at
25 July 2007 and amending ActNo. 12/2008.
LawToday:
www.
legislation.
vic.gov.au

(1)In section 21(4) of the Duties Act 2000—

(a)omit "exclusively";

(b)in paragraph (c), for "above; and" substitute "above.";

(2)After section 21(4) of the Duties Act 2000 insert—

"(4A)Subsection (3) or (4) does not apply unless the transfer, when presented to or lodged with the Commissioner, is accompanied by—

(a)a copy of the building permit, or building approval or permit; and

(b)a copy of the contract with the transferee for the construction or refurbishment; and

(c)a statutory declaration in the approved form by the transferor as to any prescribed matters and as to whether or not the transferor has entered into any agreement with the transferee in respect of works (other than construction or refurbishment) to be undertaken in relation to the land or the lot before the transfer; and

(d)if the Commissioner requires, a statutory declaration in the approved form by the transferee declaring that the transferee has not entered any contract, other than the contract referred to in paragraph (b), for the construction of the building or refurbishment of the lot; and

(e)if the Commissioner requires, a statutory declaration in the approved form by the person that issued the building permit or building approval or permit.".

4New sections 21A to 21E inserted

s. 4

After section 21 of the Duties Act 2000 insert—

"21A Commissioner may publish percentage

(1)For the purposes of sections 21(3) and 21(4), the Commissioner may from time to time publish percentage amounts being a percentage of the consideration for a transfer of dutiable property that represents any amount paid or payable in respect of construction of a building or refurbishment of a lot on or after the date on which the contract of sale was entered into.

(2)The Commissioner may publish different percentage amounts for different classes of buildings or refurbishments.

(3) If the Commissioner publishes a percentage under subsection (1)—

(a)the transferor may use that percentage for the purposes of determining the amount paid or payable in respect of construction of the building or refurbishment of the lot; and

(b)if the transferor does so, duty payable on the transfer is to be assessed on that basis.

21BRecords to be kept

If a transferor of dutiable property makes a statutory declaration under section 21(4A), the transferor must keep, or cause to be kept, all records that are necessary to enable the duty payable on that transfer to be assessed.

Penalty:500 penalty units in the case of a body corporate;

100 penalty units in any other case.

21CPeriod of retention

s. 4

(1)A transferor who is required to keep a record under section 21B must retain the record for not less than 5 years after—

(a)the date it was made or obtained; or

(b)the date on which the dutiable transaction occurred—

whichever is the later.

Penalty:500 penalty units in the case of a body corporate;

100 penalty units in any other case.

(2)Subsection (1) does not apply to a transferor if the Commissioner authorises them in writing to destroy the record before the end of the 5-year period.

21DPower to require documents

(1)The Commissioner, by written notice, may require a person to produce to the Commissioner a document that is required to be kept under section 21B.

(2)The person to whom a notice is given under subsection (1) must comply with the notice within the period specified in the notice or any extended period allowed by the Commissioner.

Penalty:200 penalty units in the case of a body corporate;

40 penalty units in any other case.

21EJoint and several liability for additional duty

If a transferor of dutiable property—

(a)makes a statutory declaration under section21(4A); and

(b)that statutory declaration is incorrect—

the transferor is jointly and severally liable with the transferee for any additional duty payable on the transfer and any penalty or interest.".

5Increase in thresholds for general rate of duty

s. 5

For the table in section 28(1) of the Duties Act 2000 substitute—

Dutiable value of the dutiable property the subject of the dutiable transaction /
Rate of duty
Not more than $25 000 / 14% of the dutiable value
More than $25 000 but not more than $130 000 / $350 plus 24% of that part of the dutiable value that exceeds $25 000
More than $130 000 but not more than $960 000 / $2870 plus 6% of that part of the dutiable value that exceeds $130 000
More than $960 000 / 55% of the dutiable value

6Provisions for determining consideration

s. 6

(1)In section 32V(4) of the Duties Act 2000—

(a)omit "exclusively"; and

(b)in paragraph (c), for "above; and" substitute "above."; and

(2)After section 32V(4) of the Duties Act 2000 insert—

"(4A)Subsection (3) or (4) does not apply unless the transfer, when presented to or lodged with the Commissioner, is accompanied by—

(a)a copy of the building permit, or building approval or permit; and

(b)a copy of the contract with the transferee for the construction or refurbishment; and

(e)if the Commissioner requires, a statutory declaration in the approved form by the person that issued the building permit or building approval or permit.

(4B)Sections 21A to 21E apply to a statutory declaration made under subsection (4A) as if a reference in those sections to subsections (3), (4) and (4A) of section 21 were a reference to subsections (3), (4) and (4A) of this section.".

7Property passing to unitholders in unit trust schemes

s. 7

For section 36B of the Duties Act 2000 substitute—

"36B Property passing to unitholders in unit trust schemes

(1)No duty is chargeable under this Chapter in respect of a transfer of dutiable property that is subject to a unit trust scheme (the principal scheme) to a unitholder in the scheme if—

(a)the duty (if any) charged by this Act in respect of the dutiable transaction that resulted in the dutiable property becoming subject to the principal scheme has been paid or the Commissioner is satisfied that the duty will be paid; and

(b)the unitholder was a unitholder at the relevant time; and

(c)the transfer is in accordance with subsection (2); and

(d)the dutiable value of the property transferred as a proportion of the net assets of the principal scheme does not exceed the value of that proportion of the net assets of the principal scheme represented by the unitholding of the unitholder in the principal scheme at the relevant time; and

(e)as a result of the transfer, the value of the unitholder's unitholding in the principal scheme is reduced by the same amount as the dutiable value of the property transferred; and

s. 7

(f) the Commissioner is satisfied that any duty charged as a result of the occurrence of a dutiable transaction referred to in section 7(1)(b)(vi) in relation to the property has been paid; and

(g) the Commissioner is satisfied that the transfer is not part of a sale or other arrangement under which there exists any consideration for the transfer.

(2)The transfer must be—

(a)to the unitholder absolutely, if the unitholder is—

(i)a natural person; or

(ii)a corporation all the shareholders of which are natural persons who were shareholders of the corporation at the relevant time; or

(b) to the unitholder as trustee of a fixed trust all the beneficiaries of which are—

(i)natural persons who were beneficiaries of that fixed trust at the relevant time; or

(ii)a corporation all the shareholders of which are natural persons who were shareholders of the corporation at the relevant time—

being natural persons or a corporation that do not hold their interests in thefixed trust as trustee of another trust; or

s. 7

(i)natural persons who were relevant beneficiaries of that discretionary trust at the relevant time or who became beneficiaries after the relevant time by reason of—

(A) becoming a spouse or domestic partner of a beneficiary within a class of beneficiary described in the discretionary trust; or

(B)becoming an adopted child or step child of, or being a lineal descendant of, a beneficiary within a class of beneficiary described in the discretionary trust; or

(C)being an adopted child, step child or lineal descendant of a person referred to in sub-subparagraph (A); or

(ii)a corporation all the shareholders of which are natural persons who were shareholders of the corporation at the relevant time—

being natural persons or a corporation thatdo not hold their rights, entitlements or interests in the discretionary trustas trustee of another trust; or

(d) to the unitholder as trustee of another unit trust scheme of which all the unitholders are—

(i)natural persons who were unitholders of that other unit trust scheme at the relevant time; or

s. 7

(ii)a corporation all the shareholders of which are natural persons who were shareholders of the corporation at the relevant time—

being natural persons or a corporation that do not hold their units in that other unit trust schemeas trustee of another trust; or

(e)to the unitholder as trustee of a superannuation fund all the beneficiaries of which were beneficiaries at the relevant time.

(3) If a unitholder would be entitled to an exemption from duty under subsection (1) but for subsection (1)(d), the unitholder is entitled to a concession from duty in respect of that proportion of the dutiable value of the dutiable property that does not exceed that proportion of the net assets of the scheme represented by the unitholding of the unitholder in the principal scheme at the relevant time.

(4) A reference in this section to dutiable property becoming or first becoming subject to a unit trust scheme includes a reference to property from which that dutiable property was derived, by subdivision or consolidation of titles, becoming or first becoming subject to the scheme at a time when the unitholder was a unitholder in the principal scheme.

(5) In this section—

relevant beneficiary of a discretionary trust means a natural person who—

s. 7

(a) was a beneficiary of that trust at the relevant time; or

(b) became a beneficiary of that trust after the relevant time by reason of—

(i) becoming a spouse or domestic partner of a beneficiary within a class of beneficiary described in the discretionary trust; or

(ii) becoming an adopted child or step child of, or being a lineal descendant of, a beneficiary within a class of beneficiary described in the discretionary trust; or

(iii) being an adopted child, step child or lineal descendant of a person referred to in subparagraph (i);

relevant time in relation to dutiable property that is subject to the principal scheme, means the time at which the property first became subject to the principal scheme;

superannuation fund has the same meaning as in section 41A.".

8New section 38A inserted

s. 8

After section 38 of the Principal Act insert—

"38A Special disability trusts

(1)No duty is chargeable under this Chapter in respect of—

(a)a declaration of trust that establishes a special disability trust; or

(b)a transfer of dutiable property to the trustee of a special disability trust—

in the circumstances set out in subsections(2), (3) and (4).

(2)The person declaring the trust, or the transferor of the dutiable property (as the case requires) must be an immediate family member of the principal beneficiary of the special disability trust.

(3)There must be no consideration provided for the declaration or transfer.

(4)The dutiable value of the property that is the subject of the declaration or transfer must not exceed $500000.

(5)If,but for subsection (4), duty would not be chargeable in respect of a declaration of trust or transfer of dutiable property because of this section, duty is chargeable on the declaration or transfer only in respect of the dutiable value of the property that exceeds $500000.

(6)In this section—

immediate family memberof a principal beneficiary, means an individual—

(a)who is a natural parent, adoptive parent or step-parent of the principal beneficiary; or

(b)who is, or was when the principal beneficiary was under 18 years of age, a legal guardian of the principal beneficiary; or

(c)who is a grandparent of the principal beneficiary; or

s. 8

(d)who is a sibling of the principal beneficiary;

principal beneficiary—

(a)has the meaning given in section 1209M(1) of the Social Security Act, in the case of a special disability trust within the meaning of section 1209L of that Act;

(b) has the meaning given in section 52ZZZWA(1) of the Veterans' Entitlements Act, in the case of a special disability trust within the meaning of section 52ZZZW of that Act;

Social Security Act means the Social Security Act 1991 of the Commonwealth;

special disability trust means—

(a)a special disability trust within the meaning of section 1209L of the Social Security Act; or

(b) a special disability trust within the meaning of section 52ZZZW of the Veterans' Entitlements Act;

Veterans' Entitlements Act means the Veterans' Entitlements Act 1986 of the Commonwealth.".

9Increase in principal place of residence concession

s. 9

(1)In section 57I(1)(d) of the Duties Act 2000, for "$115000 but not more than $500000" substitute "$130000 but not more than $550000".

(2)For the table in section 57J of the Duties Act 2000 substitute—

Dutiable value of the dutiable property /
Rate of duty
More than $130000 but not more than $440000 / $2870 plus 5% of that part of the dutiable value that exceeds $130000
More than $440000 but not more than $550000 / $18370 plus 6% of that part of the dutiable value that exceeds $440000

(3)Section 57O of the Duties Act 2000 is repealed.

10Increase in eligible pensioner concession

(1)In the Duties Act 2000—

(a)in section 59(1)(b) for "$300000" substitute "$330000";

(b) in section 59(2)(b) for "$300000 but does not exceed $400000" substitute "$330000 but does not exceed $440000";

(d) in section 60(1)(c) for "$300000" substitute "$330000";

(e) in section 60(2)(c) for "$300000 but does not exceed $400000" substitute "$330000 but does not exceed $440000";

(f) in section 60(3), for the formula substitute—

(2)In section 60A of the Duties Act 2000—

(a)in subsection (1)—

(i)for "section 18(3)" substitute "section18(5)";

(ii)in paragraph (b), after "section 18(2)" insert "or (2A) (or both)";

(b)in subsections (2)(b) and (3), after "section18(2)" insert "or (2A) (or both, as the case requires)".

11Consequential amendments to first home owner concession

s. 11

(1)In the Duties Act 2000—

(a) in section 62(3), for the formula substitute—

(b) in section 62(4), for the formula substitute—

(2)In section 63B of the Duties Act 2000—

(a)in subsection (1)(b), after "section 18(2)" insert "or (2A) (or both)";

(b)in subsections (2)(b) and (3), after "section18(2)" insert "or (2A) (or both, as the case requires)".

12New Division 1B inserted in Part 2 of Chapter 11

s. 12

After Division 1A of Part 2 of Chapter 11insert—

"Division 1B—Exchange of stapled ownership interests for ownership interests in a unit trust scheme

250DHDefinitions

In this Division—

exchanging members has the same meaning as in section 124-1045(1)(d) of the ITAA;

interposed trustmeans a unit trust scheme that is interposed between the exchanging members and the stapled entities in the course of, or as a result of, a roll-over;

ITAA means the Income Tax Assessment Act 1997 of the Commonwealth;

listed, in relation to the shares or units in a stapled entity, means listed for quotation on the Australian Stock Exchange or a recognised stock exchange;