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Chapters

  1. Overview
  2. Change in beneficial ownership of dutiable property
  3. Change in beneficial ownership of dutiable property - Regulation
  4. Change in beneficial ownership - Grant of an Option
  5. Acknowledgement of trust
  6. Off the plan transactions
  7. Breakup of marriages and de facto relationships
  8. Transfer of certain business property between family members
  9. Surcharge purchaser duty Australian-based developer
  10. Tax avoidance schemes
  11. Other changes to the Taxation Administration Act 1996
  12. Land Tax
  13. First Home Owner Grant
  14. Other legislative changes

4. Change in beneficial ownership - Grant of an Option

Section 8(1)(b)(ix) of the Duties Act 1997

Introduces duty on certain transactions that results in a change of beneficial ownership of dutiable property. This includes the creation of dutiable property

This means that duty will be payable on the grant of an option.

How is duty calculated?

Ad valorem duty is calculated on the call option fee paid for the grant of an option.

The call option fee (consideration) includes GST (if applicable).

Minimum duty of $10.00 will apply as per section 273 of the Duties Act 1997 for transactions entered into on or before 31 January 2024.

Minimum duty of $20 will apply for transactions entered into on or after 1 February 2024.

Our online duty calculators can be used to quickly calculate duty liability.

Note:

  • Duty paid on the call option fee is not credited towards the duty payable when the option is exercised.
  • If the option is not exercised, a refund of duty will not be issued for duty paid on the grant of an option.
  • Any put option fee is not liable to duty and does not form part of the consideration.

Can this transaction attract premium transfer duty?

Premium transfer duty will be payable if the grant of an option relates to residential property and the call option fee is greater than the relevant premium duty threshold. Refer to the transfer duty page on our website for the current threshold.

Use our online duty calculators to quickly calculate duty liability.

Can this transaction attract surcharge purchaser duty?

Surcharge purchaser duty (Chapter 2A of the Duties Act 1997) does not apply to transactions that are liable to duty under section 8(1)(b)(ix).

What are the evidentiary and identification requirements?

There are new evidentiary requirements for Section 8(1)(b)(ix). This information has been updated on our website and includes a link to the client identification requirements for this transaction type.

What forms do I need?

This declaration must be completed for all grant of option transactions first entered into on or after 19 May 2022.

The Purchaser/Transferee Declaration is not required for this transaction type.

How are these transactions processed?

This transaction must be processed via EDR under document type “Grant of Option”.

EDR systems have been updated to offer this new document type.

Where can I find more information?