Families on the land will be able to transfer ownership of land
and certain other assets between family members without paying
transfer duty in a much broader range of circumstances from 1 July
Transfer duty, which is a calculated on a sliding scale up to
5.75% of unencumbered value, is significant impost on transfers of
land and other business assets in Queensland. Primary producers are
disproportionately affected by this form of tax given the value of
the land and other dutiable property they must acquire to generate
relatively modest returns.
An important concession has historically been allowed for gifts
of rural property to children or grandchildren with the result that
duty was imposed on only the actual price paid (if any) and
liabilities assumed (if any) irrespective of the value of the
property. This concession was extended by the previous Queensland
Government. Since 1 July 2014, the recipient of the property has
not needed to be a direct lineal descendant of the transferor and
instead can be a spouse, parent, grandparent, sibling, aunt, uncle,
niece or nephew. However, the concession still only applied to the
extent the transfer was your way of a gift.
In conjunction with the 2016 Queensland Budget, legislation has
been introduced to Parliament that will extend and simplify the
concession significantly. From 1 July 2016, the gift requirement
will be removed meaning that, provided the other requirements are
met, no duty will be payable even where the recipient of the
property pays for it or assumes debt in conjunction with the
For example, where a family member takes over their
relative's mortgage debt at the same time as the property and
meets the requirements for the concession, duty will no longer be
assessed on the value of that debt. Where that debt is say
$2,000,000, the duty saving will be $95,525.
Similar duty concessions are applicable to transfers of
partnership interests, shares in landholding companies and units in
particular family unit trusts.
The Government is to be commended for recognising the importance
of tax-effective pathways for succession planning on
Queensland's farms, approximately 99% of which continue to be
family owned and operated.
Thynne + Macartney's agribusiness lawyers help their clients
develop and implement succession plans that maximise eligibility
for duty concessions.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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