Transfer Duty Compliance
Learn how Revenue NSW conducts audits to ensure the correct amount of Transfer Duty is paid and what to expect if you or your practice are selected for an audit.
One of the ways Revenue NSW ensures compliance with Transfer Duty laws is by conducting audits.
We audit customers and Electronic Duties Returns (EDR) clients who assess documents on behalf of customers to ensure the correct amount of Transfer Duty has been paid.
We also review recipients of Duty related benefits and grants to ensure compliance with post transactional requirements such as residence requirements and land usage.
How we select customers for audit
Revenue NSW uses specialised data matching programs to identify risks or errors in assessments for Transfer Duty.
We also select audits based on:
- research and risk profiling
- information sharing with other government agencies, and
- tip-offs and referrals.
The most common reasons why we select transactions for audit include:
Random verification audits
Approved Electronic Duties Returns (EDR) clients may be subject to an arrangement where matters for audit are randomly selected and identified with an EDR system alert at the time the transaction is processed.
What happens when you are audited?
One of our auditors will contact you via telephone to discuss the audit and explain the:
- reason you were selected
- information you need to send us
- timeframe for the audit and further information requests, and
- resources and support available to assist you with the audit.
We will then issue you a:
- Notice of Investigation letter that formally confirms that an audit has commenced and includes details of the information you need to provide, and
- if applicable, any required declarations.
To improve customer experience and data security we have introduced the Duties Compliance Portal.
This is an online service provided by Revenue NSW to assist customers and clients in complying with requests relating to Duties compliance activities.
What you need to do
Review the Notice of Investigation carefully and ensure you provide all the information requested by the due date.
If you need to clarify anything, contact your auditor. Your auditor’s contact details are on the Notice of Investigation letter.
We recommend you review your transactions to confirm the correct amount of Transfer Duty has been paid.
You may qualify for a reduced rate of penalty tax if you make a voluntary disclosure of any errors which have resulted in underpaid Transfer Duty.
Information you may need to supply
The Notice of Investigation lists the information that you must provide. Examples of information that we may request include:
- The Endorsed (Stamped) instrument, which includes but is not limited to:
- Agreement for Sale of Land
- Agreement for Sale of Business
- Transfer
- Trust Deed
- Deed of Variation
- Completed Purchaser/Transferee Declaration form (ODA 076i or ODA 076ni).
- Supporting evidence as set out in Part B of Purchaser/Transferee Declaration – Explanatory Notes and Supporting evidence (ODA 076 EN).
- Certified client identification documents.
Where applicable:
- Completed Revenue NSW application forms, inclusive of attachments and supporting evidence
- Supporting declarations
- International movement records from the Department of Home Affairs
- Valuation report
- Any other document relied upon and relevant to the assessment of Duty liability.
What happens next?
- We will review the information and contact you if we require anything else.
- We will validate the information you provide against information collected from other sources, such as other State and Commonwealth government agencies.
- You will then be sent a finalisation letter outlining the audit outcome. The finalisation letter formally ends the audit.
What are the possible outcomes of an audit?
An audit may result in:
- No Further Action – where no errors are found.
- Issuing of a Transfer Duty Notice of Assessment – where errors have been identified resulting in additional Duty payable.
Additional tax payable
Payment is due 21 days after the issue date of a Notice of Assessment.
If you need assistance with arranging or managing a payment plan you can contact the Tax Debt Management team.
Interest and penalties
Failure to pay the correct amount of Transfer Duty on time is considered a tax default and is subject to interest and penalty tax.
You may be charged interest and penalties depending on the outcome of the audit and the circumstances of any tax shortfall.
For more details read:
How to lodge an objection
If you disagree with any of our findings you can lodge an objection.
You must lodge the objection in writing within 60 days of an assessment or decision being made.
Compliance tips for Transfer Duty
If your Transfer Duty transactions are processed correctly, it makes it less likely you will be selected for an audit.
Here are some useful tips to help you meet your Transfer Duty obligations:
- Refer to the Property professionals resource centre when preparing assessments
- conduct regular reviews to ensure your transactions are correct when processing and make a voluntary disclosure when you find an error
- engage with us by supplying information if we contact you prior to an audit as part of an upfront compliance program.
- subscribe to our newsletter to stay up to date
- contact us if you need help.
What happens if you do not comply?
If you do not comply with a reasonable request made by your auditor we may exercise one or more of our powers under the Taxation Administration Act 1996:
- Serving a notice requiring you to provide the information. Failure to comply with this notice may constitute an offence and render you or your practice liable to a penalty or further legal action
- assessing your tax liability based on any information we have. This includes making an estimate from data we access from other government agencies.
Our approach to customer service
We will be fair, objective, and professional in all dealings with you.
During an audit, you can expect that we will:
- clearly explain what information we require and why we need it
- provide you with a reasonable time in which to respond to our requests
- review the information you provide to us in a timely manner
- keep you informed of the progress at regular intervals
- provide education to help you process future Transfer Duty transactions.
Contact the Transfer Duty team
If you or your practice are currently being audited, please contact your auditor. Your auditor’s contact details are on the Notice of Investigation letter.
For general questions about Transfer Duty call 1300 139 814 or +61 2 7808 6916 for international callers.
You can also email Duties@revenue.nsw.gov.au
