Nominations under options and the treatment of mining tenements
and primary production land under the landholder provisions are the
subject of amendments to the Duties Act 1997 currently before the
NSW State Parliament.
Once passed, the State Revenue Legislation Amendment Act 2013
will effect the following amendments:
Nominations under, and novations of, options to purchase land,
if effected for valuable consideration, will be deemed to be
transfers of options to purchase land, attracting transfer
duty. This reflects OSR practice prior to the recent
decision of Justice Gzell in CTI Joint Venture Company Pty Ltd v
CCSR. The new section will apply to all nominations or novations
made for valuable consideration on or after the later of 1 July
2013 and the date of assent to the Bill. It has no impact on the
existing provisions relating to put and call options.
A new definition of "mining tenements" and a revised
definition of "interest in land" have been included so
that assessment leases, exploration licences and opal
prospecting licences will be deemed to be interests in land under
the Act, including for landholder duty purposes. In
addition, the unencumbered value of an interest in land arising
because of a mining tenement will now include the value of any
information about the land.
The 80% land-rich test in respect of land used for
primary production has been removed from the landholder
duty provisions. Thus land used for primary production is to be
treated in the same way as any other land.
The exemption from landholder duty in circumstances where the
Chief Commissioner is satisfied it would not be just and reasonable
to levy duty has been removed.
These changes are likely to become effective on 1 July 2013.
Accordingly, it may be necessary to bring forward any transactions
which might be affected by them.
Clayton Utz communications are intended to provide
commentary and general information. They should not be relied upon
as legal advice. Formal legal advice should be sought in particular
transactions or on matters of interest arising from this bulletin.
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The income tax treatment of any property lease incentive will vary, depending on the nature of the inducement provided.
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