Nominations under options to change the transferee of
land will now attract transfer duty.
The State Revenue Legislation Further Amendment Bill 2014 was
finally passed by both Houses of the New South Wales Parliament
earlier this month and has now received Royal Assent.
Importantly, these amendments mean that nominations under
options can no longer be used by practitioners as a tool to change
the transferee of land in a transaction without attracting duty in
New South Wales.
The relevant amendments to the Duties Act 1997 (NSW) effected by
the now State Revenue Legislation Further Amendment Act 2014 (NSW)
On and from 23 October 2014, the following will be deemed to be
a transfer of an option to purchase land in New South Wales and
will attract transfer duty accordingly:
nominations under options to purchase land in New South Wales,
if the nomination has been made for valuable consideration;
nominating another person as the purchaser or transferee of
land the subject of an option, prior to the exercise of the option,
if valuable consideration has been provided by or on behalf of the
nominee for the nomination; and
an option holder agreeing, for valuable consideration, to a
novation of the option, or otherwise relinquishing rights under the
option, so that another person is able to obtain a right to
exercise the option or is able to purchase the land.
Similarly, a novation of an agreement for lease of land in New
South Wales will also be taken to be a transfer of dutiable
property, being a transfer of the lessee's interest in the
leased property and will attract transfer duty in New South
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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Exemptions or concessions on stamp duty could apply when contemplating the purchase or transfer of NSW real estate.
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