Immediately after I published my last blog Stamp Duty Requirements on Change of SMSF Trustees I got questions on stamp duty on property transfers to a Self Managed Superannuation Fund. At first I attempted to the answers myself but to ensure ongoing accuracy I am pleased to have Caroline Harley, one of the best lawyers in the SMSF sector review and update this information.
Caroline Harley | Special Counsel
So here is the current breakdown on stamp duty for property investors or small business owners looking to move property they own personally in to their SMSF.
Stamp duty imposed by State and Territory governments should always be researched and considered before transferring land to an SMSF. Concessions or exemptions from duty may be available depending on the State or Territory in which the land is situated.
This concession can be very significant. If the SMSF purchases NSW land/property from a member with a market value of $500,000, the duty which would apply (but for the concession) is $17,990. With the concession, the saving in duty is $17,240 as concessional duty is only $750.
Reminder: the land/property must be business real property owned in the personal name of the member rather than a company (otherwise the trustee would not be permitted to acquire the real estate).
The provisions of the duties legislation of each State or Territory differ, however where concessions or exemptions are available they generally require the transferor to continue to be the beneficial owner of the land (this relates to business real property as it is the only land which an SMSF may directly acquire from a member).
The following tables set out the details of the stamp duty offices and relevant provisions of the relevant legislation in each State and Territory. This is up to date as at 27 February 2017.
| NSW | Transfer to a SMSF |
|---|---|
| Duty payable | $750 subject to conditions being met. Previously $500 but increased 01/02/2024. Depending on the documentation in place for the transaction you may be able to apply for a retrospective re-assessment and obtain a refund. An SMSF specialist lawyer would be able to advise you on this. |
| Relevant provisions | 62A NSW Duties Act 1997 |
| General description of legislation | Nominal duty is charged on a transfer of dutiable property from a person to a trustee of an SMSF where the: transferor is the only member of the super fund or the property is to be held by the trustee solely for the benefit of the transferor (ie property or proceeds of sale of property cannot be pooled with property held for another member and no other member can obtain an interest in the property or proceeds of sale); and property is to be used solely for the purpose of providing a retirement benefit to the transferor. |
| Document-ation | Evidence that it is a complying SMSF as at the date of the agreement/transfer, copy of minutes of meetings of the SMSF stating the intention to have the property transferred to it and confirming that the property was owned beneficially by the transferor member, copy of the SMSF trust deed or a variation to it, showing a non revocable clause that the property is segregated for the transferor member’s benefit only (follows wording in section62A(2)) |
| Legislation | Duties Act 1997 (NSW) |
| Legislation website | http://www.austlii.edu.au/au/legis/nsw/consol_act/da199793/ |
| Office | Office of State Revenue |
| Website | http://www.osr.nsw.gov.au |
| VIC | Transfer to a super fund |
|---|---|
| Duty payable | No duty subject to conditions being met |
| Relevant provisions | Section 41 Vic Duties Act 2000 |
| General description of legislation | No duty is charged in respect of the transfer of dutiable property made without monetary consideration to a trustee of a super fund, where there is no change in beneficial ownership (again, property must be held in the personal name of the member and not a company name). A transfer of property to a trustee of a super fund by a beneficiary of the fund does not, for the purposes of this section, effect a change in the beneficial ownership of the property. |
| Document-ation | Documents are required – refer to ‘Evidentiary Requirements for Dutiable and Exempt Transactions’ on SRO website |
| Legislation | Duties Act 2000 (VIC) |
| Legislation website | http://www.austlii.edu.au/au/legis/vic/consol_act/da200093/ |
| Office | State Revenue Office (SRO) |
| Website | http://www.sro.vic.gov.au/land-transfer-duty |
No luck in QLD
| QLD | Transfer to a super fund |
|---|---|
| Duty payable | $20 subject to conditions being met |
| Relevantprovisions | You can claim this concession on transfer duty if you:
The superannuation fund must become a complying superannuation fund within 1 year. A complying superannuation fund is:
|
| General desc-riptionof legislation | A transfer of dutiable property is a concessional dutiable transaction. |
| Document-ation | Duties office form and documents are required. https://www.publications.qld.gov.au/ckan-publications-attachments-prod/resources/755a8bd9-7134-4a5f-85e7-a54c747ec7bd/form-d2.6-v2-effective-7-jan-2008.pdf? |
| Legislation | Duties Act 2001 (QLD) |
| Legislationwebsite | http://www.austlii.edu.au/au/legis/qld/consol_act/da200193/ |
| Office | Office of State Revenue |
| Website | http://www.osr.qld.gov.au/duties/index.shtm l |
| WA | Transfer to a super fund |
|---|---|
| Duty payable | $20 |
| Relevant provisions | Sections 122 – 124 WA Duties Act 2008 |
| General description of Legislation | Nominal duty is charged on a transfer of dutiable property by a person to the trustee of a super fund where – |
| ▪ there is consideration for the transfer; and | |
| ▪ only the transferor can be a member of the super fund or the property is held in the superfund specifically for the transferor (ie property cannot be pooled with the assets of another member and no other members can obtain an interest in the property); and | |
| ▪ the property (or if sold, the proceeds) can only be held in the superannuation fund to be provided to the transferor as a retirement benefit. | |
| If the fund subsequently fails to satisfy any of the requirements (above) full stamp duty is payable in respect of any dutiable property still held. | |
| Nominal duty is charged under section 124 in respect of a transfer of dutiable property to the trustee of an SMSF that is an employer sponsored fund where – | |
| there is no consideration for the transfer. | |
| Document- ation | Application form is required – ‘Superannuation Fund Transactions – Application for Nominal Duty’. |
| Legislation | Duties Act 2008 (WA) Also refer to Duties Fact Sheet – Superannuation Transactions |
| Legislation website | http://www.austlii.edu.au/au/legis/wa/consol_act/da200893/ |
| Office | Office of State Revenue |
| Website | http://www.finance.wa.gov.au/cms/section.aspx?id=209 |
| ACT | Transfer to a super fund |
|---|---|
| Duty payable | Ad valorem duty applies |
| Relevant provisions | No provision for exemption or concession from duty |
| General description of legislation | Duty is charged on a transfer of dutiable property. |
| Document-ation | Lodgement form and documents are required. |
| Legislation | Duties Act 1999 (ACT) |
| Legislation website | http://www.austlii.edu.au/au/legis/act/consol_act/da199993/ |
| Office | ACT Revenue Office |
| Website | http://www.revenue.act.gov.au |
| SA | Transfer to a super fund |
|---|---|
| Duty payable | Ad valorem duty applies |
| Relevant provisions | No provision for exemption or concession from duty |
| General description of legislation | A transfer of property to a person who takes as trustee is deemed to be conveyance whether or not any consideration is given (except in certain circumstances regarding the transfer of family farming properties) |
| Document-ation | Lodgement form and documents are required |
| Legislation | Stamp Duties Act 1923 (SA) |
| Legislation website | http://www.austlii.edu.au/au/legis/sa/consol_act/sda1923157/ |
| Office | Revenue SA |
| Website | http://www.revenuesa.sa.gov.au |
| NT | Transfer to a super fund |
|---|---|
| Duty payable | Ad valorem duty applies |
| Relevant provisions | No provision for exemption or concession from duty |
| General description of legislation | A conveyance of dutiable property is a dutiable instrument. |
| Document-ation | Lodgement form and documents are required |
| Legislation | Stamp Duty Act (NT) |
| Legislation website | http://www.austlii.edu.au/au/legis/nt/consol_act/sda151/ |
| Office | Territory Revenue Office |
| Website | http://www.treasury.nt.gov.au |
| TAS | Transfer to a super fund |
|---|---|
| Duty payable | $50 |
| Relevant provisions | Section 49 Duties Act 2001 (TAS) |
| General description of legislation | Where the duties office is satisfied there is no change in the beneficial ownership of the property duty chargeable on the transfer is $50. Also an exemption is available in certain circumstances regarding the transfer of primary production land. |
| Document-ation | For primary production see ‘Documentary Evidence requirements Guideline’, for other transfers duties office reviews each transfer on its own facts recommend seeking confirmation of eligibility prior to lodgement. |
| Legislation | Duties Act 2001 (TAS) |
| Legislation website | http://www.austlii.edu.au/au/legis/tas/consol_act/da200193/ |
| Office | State Revenue Office |
| Website | http://www.sro.tas.gov.au |
If you don’t get an exemption the the rates applicable are:
Moving Property to an SMSF is not something to be done lightly without looking at the pros and cons as well as the procedures in your state or territory.
We have design a 3 part guide to buying a property in an SMSF
- Property through super in a SMSF – Part 1: Background
- Property through super in a SMSF – Part 2: The Process
- Property through super in a SMSF – Part 3: 20 most common mistakes
Even more information and complimentary strategy ideas are available on our Property in a SMSF page. Contact Caroline for specific legal advice on your proposed strategy.
IMPORTANT
This information is current as at the date of publication but may be subject to change. This article is general in nature and has been prepared without taking into account a potential your objectives, financial situation or needs. Before making a recommendation based on this article, seek personal legal and tax advice and consider its appropriateness based on the your objectives, financial situation and needs.
Are you looking for an advisor that will keep you up to date and provide guidance and tips like in this blog? Then why now contact me at our Castle Hill or Windsor office in Northwest Sydney to arrange a one on one consultation. Just click the Schedule Now button up on the left to find the appointment options.
Liam Shorte B.Bus SSA™ AFP
Financial Planner & SMSF Specialist Advisor™
Tel: 02 9899 3693, Mobile: 0413 936 299
- PO Box 6002 NORWEST NSW 2153
- Suite 40, 8 Victoria Ave, Castle Hill NSW 2154
- Suite 4, 1 Dight St., Windsor NSW 2756
Corporate Authorised Representative of Viridian Advisory Pty Ltd ABN 34 605 438 042, AFSL 476223
This information has been prepared without taking account of your objectives, financial situation or needs. Because of this you should, before acting on this information, consider its appropriateness, having regard to your objectives, financial situation and needs. This website provides an overview or summary only and it should not be considered a comprehensive statement on any matter or relied upon as such.
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