SMSFs gain stamp duty relief in NSW

Changes to New South Wales legislation have given SMSFs better tax outcomes.

New self-managed superannuation funds (SMSF) set up in New South Wales have been granted more favourable stamp duty treatment after an amendment to the NSW Duties Act 1997.

The change has been made to the application of section 62A, which allows a nominal stamp duty, as low as $50, to apply when transferring a property into an SMSF previously owned by a member of the fund or an in specie transfer.

In the past, the concession only applied if the SMSF was regulated and was a complying fund. This meant the trustees would have a notice of compliance issued by the Australian Taxation Office (ATO).

However, this arrangement was problematic for newly-established SMSFs as the ATO notice of compliance was unable to be issued until the first annual return for the fund had been submitted and processed.

It meant new funds looking to make an in specie property transfer soon after set up were subject to pay a higher level of stamp duty.

The amendment will now allow a newly-established SMSF to qualify for the stamp duty concession regarding an in specie property transfer if the trustees of the fund are satisfied it meets the ATO's conditions of a complying fund at the time the stamp duty liability is incurred.

Under the amended legislation, the Office of State Revenue will have the right to impose a higher stamp duty charge on the SMSF if it feels the conditions to qualify for the concession are not met.

In an additional legislative development, the NSW Land Tax Management Act 1956 has also been changed so SMSFs are now entitled to the NSW land tax zero rate threshold.

Before now, this threshold was only available to superannuation funds deemed complying under section 42 of the Superannuation Industry (Supervision) (SIS) Act 1993.

SMSFs are deemed complying under section 42A of the SIS Act and this has now been taken into account.

Both of the changes above received royal assent on 11 April via the State Revenue Legislation Amendment Act 2012.

investordaily.com

New Land Tax thresholds for 2012 announced

Land tax is calculated on the combined value of all the taxable land you own above the land tax threshold. The rate of tax is $100 plus 1.6% of the land value between the threshold and the premium rate threshold and 2% thereafter.

If land is owned by a trustee of a special trust the land tax threshold does not apply and land tax will be charged at a flat rate of 1.6% of the taxable land value up to the premium threshold and then 2% thereafter.

If the combined value of your land does not exceed the threshold, no land tax is payable.

For 2012, the land tax threshold for 2012 is $396,000.

A premium land tax marginal rate of 2% applies on the total taxable land value above the premium threshold ($2,421,000).

The Valuer General used the following indexed amounts to determine the average of indexed amounts for the 2012 tax year:

Year	Indexed amount
For the 2010 land tax year	$380,000
For the 2011 land tax year	$401,000
For the 2012 land tax year	$408,000
Average	$396,000

More details are available on the Office of State Revenue website.