Transfers not in conformity and surcharge purchaser duty

Where a transfer is not in conformity with the agreement for sale or transfer, surcharge purchaser duty will be calculated at the rate of 9% on the dutiable value for all foreign purchasers or transferees if:

• The date of completion is on or after 1 January 2025, and
• the total shares actually transferred to foreign persons are more than the share or shares agreed to be sold or transferred.

When is a transfer not in conformity?

A transfer is not in conformity with an agreement for sale or transfer of land if any of the following apply:

• the transferee and transferor in the transfer are not respectively identical to the purchaser and the vendor on the agreement
• the interest/share in the property acquired by each purchaser on the agreement is not identical with the interest/share in the property that is actually transferred to each transferee
• the share of the property being transferred to foreign persons exceeds the share of the property agreed to be sold to foreign persons
• the property described in the transfer is not the same as the property agreed to be sold or transferred in the agreement
• the consideration in the transfer differs to the purchase price in the agreement.

How are the transitional provisions applied to transfers not in conformity?

The following examples demonstrate how the surcharge purchaser duty rates will be applied in accordance with the transition provisions.

Note: section 104Y of the Duties Act 1997, also applies where the share transferred to a foreign person differs from the share agreed to be sold or transferred.

Result:

Surcharge purchaser duty is calculated at the rate of 8% as:

• the date of completion is before 1 January 2025.

Result:

Surcharge purchaser duty is calculated at the rate of 8% on the proportion of the property Purchaser A is acquiring (50%) as:

• the date of the agreement is before 1 January 2025 and
• the shares transferred to the foreign persons (Purchaser A) is not greater than the shares agreed to be transferred to foreign persons.

Result:

Surcharge purchaser duty will be calculated at the rate of 8% as:

• the date of agreement is before 1 January 2025, and
• the combined share in the property being transferred to foreign persons (Purchaser A and Transferee B) is not greater than the share originally agreed to transferred to foreign persons (Purchaser A).

Result:

Surcharge purchaser duty is calculated at the rate of 9% of the dutiable value as:

• the date of completion is after 1 January 2025, and
• the shares transferred to the foreign persons (Transferee B) is greater than the shares agreed to be transferred to foreign persons.

Result:

Surcharge purchaser duty is calculated at the rate of 9% of the dutiable value of the entire share (70%) Purchaser B is acquiring as:

• the date of completion is after 1 January 2025, and
• the shares transferred to the foreign persons (Purchaser B) is greater than the shares agreed to be transferred to foreign persons.

Result:

Surcharge purchaser duty at the rate of 9% on the dutiable value of the whole of the property as:

• the date of completion is after 1 January 2025,
• the transfer is not in conformity with the contract, and
• the shares in the property being transferred to foreign persons is greater than the shares originally agreed to be sold.

Result:

Surcharge purchaser duty is calculated at the rate of 9% on the dutiable value of the combined share (80%) being acquired by foreign persons as:

• the date of completion after 1 January 2025,
• the transfer is not in conformity with the contract, and
• the combined share in the property being transferred to foreign persons (Purchaser B and C) is greater than the share originally agreed to be sold.