Important changes to land tax and stamp duty surcharges.
The NSW Government has recently proposed new laws to target discretionary trusts that currently own or intend to own NSW property, either directly or indirectly via other entities (i.e. unit trusts, companies and partnerships, subject to some exclusions). The new laws will mean that discretionary trusts may be treated as ‘foreign persons’ with the following consequences:
- A land tax surcharge of 2% (in addition to the normal land tax); and
- A stamp duty surcharge of 8% (in addition to the normal stamp payable on NSW property acquisitions).
To prevent this from happening, your trust deed must be amended so that it includes provisions that specifically exclude foreign persons as trust beneficiaries. If your trust already holds NSW property and has paid either of the above surcharges, then you only have until 31 December 2019 to amend the trust deed to obtain a refund on surcharges paid.
Please contact our office to discuss the matter further.