New NSW Stamp Duty Concession

NSW has recently introduced a new concession in respect of the transfer of dutiable property (eg land) held by a member of a super fund to their super fund.  Without this concession, ad valorem duty would have been payable in respect of the transfer.  Now, if certain conditions are satisfied, the duty will be $50.  The concession is provided by s62A of the Duties Act, 1997.  The normal title registration fees will still apply.

For the $50 concession to apply the following conditions must be satisfied:

• The fund must be a self managed superannuation fund and either:
  • the member is the sole member of the fund; or
  • the fund is a multi-member fund and the transferred property is held solely for the benefit of the member who made the transfer;

• The transferred property is to be used solely for the purpose of providing a retirement benefit for the member who made the transfer.

The requirement that the transferred property is to be held solely for the member who made the transfer means that the property must be held in a distinct property portfolio; the property cannot be pooled with any other property held for another member of the fund, and no other member can obtain an interest in the property.

The property can be sold and the requirement for separate and exclusive holding will apply to the proceeds of the sale of the property.

It seems that the property could be transferred during accumulation phase and held during pension phase.  However, the requirement that the property is used solely for the purpose of providing a retirement benefit arguably means that any pension financed by the property must not be a reversionary pension.

A duties ruling is likely to be issued in respect of the new concession by the NSW Office of State Revenue to clarify the finer administrative practices to be applied to applications for the $50 concession.