A bill has recently been introduced to Parliament (State Revenue Legislation Further Amendment Bill 2014 [2014]) that proposes a number of changes to the Duties Act 1997. If passed, amendments to section 62A are of note regarding property transfers to SMSF.

Firstly, the concessional rate of duty will increase from $50 to $500 on transfers from members to their SMSF but only if:

(a) there are no other member/s of the SMSF other than the member/s transferring the property OR the dutiable property is segregated from the other fund property, and

(b) the property is solely for the purpose of providing a retirement benefit to the member/s transferring the property, and

(c) if there is more than one member transferring the property, it is to be used for the benefit of those members in the same proportions as it was held by them before the transfer.

Further, on a declaration of trust made by a custodian of the trustee of a SMSF, that dutiable property is to be held in trust for the trustee of a SMSF, a flat rate of $500 is payable if:

(a) the declaration of trust names the SMSF, and

(b) ad valorem duty has been paid on the acquisition of property by the custodian or the trustee or section 62A applied to that acquisition, and

(c) the Chief Commissioner is satisfied that the consideration for the acquisition of the dutiable property was or will be provided by the trustee of the SMSF.

This article is general information only and should not be relied on without obtaining further specific information.

For more information please contact Linda Alexander.