Fractional interest quick reference guide

What is fractional interest?

Fractional interest is when there is a transfer of real property, which includes multiple transferees where at least one is a current title holder.

It does not apply to sole purchasers or Party A transferring whole interest to Party B.

Applicable document types

Fractional interest applies to the transfer only document type, Document 4.

When do I select yes for Fractional interest?

You must select yes for fractional interest when there is a transfer of real property, which includes multiple transferees where at least one transferee is a current title holder.

Fractional interest is used to calculate Surcharge purchaser duty where there are multiple transferees.

If you do not select the correct option, you may receive an error when processing in EDR and the Surcharge purchaser duty value may be incorrect.

What happens when fractional interest is yes?

The Transfer type field must be populated when there is a fractional interest. The transfer type will determine whether Surcharge purchaser duty is payable.

  • Title only – transferee is keeping the same percentage or decreasing percentage by way of transfer
  • Title and transferee – transferee on title, staying on title and increasing percentage.
    • When Title and transferee is selected, an additional field Previous land holding displays. This is the % previously held on title

New transferee – transferee not currently on title, being added to title.

Scenarios

Fractional

Scenario 1

Party A transferring to Party A & C (50%/50%), where Party C is a foreign person.

Party A = $1,000,000

On transfer:

Party A = $500,000 and Party C = $500,000

As a foreign person, Party C has a surcharge amount of $40,000

Scenario 2

Party A & B (50%/50%) transferring Party B’s interest to Party A & C equally, where Party C is a foreign person.

Party A = $500,000 and Party B = $500,000

On transfer:

Party A = $750,000 and Party C = $250,000

As a foreign person, Party C has a surcharge amount of $20,000

Scenario 3

Party A & B transferring to Parties B, C & D, where Party C is a foreign person.

Party A = $1,400,000 and Party C = $600,000

On transfer:

Party B = $600,000 and Party C = $800,000 and Party D = $600,000

As a foreign person, Party C has a surcharge amount of $16,000

Non-fractional

Scenario 4

Party A & C (50%/50%) transferring to Party C, where Party C is a foreign person.

Party A = $500,000 and Party C = $500,000

On transfer:

Party C = $1,00,000

As a foreign person, Party C has a surcharge amount of $40,000

Scenario 5

Party A transfers 100% to Party B.

Party A = $1,000,000

On transfer:

Party B = $1,000,000

Last updated: 21 December 2017