The NSW Government has removed the $50 duty concession in respect of changes of trustees of a SMSF. Accordingly if the trustees of a self managed super fund are changed and cannot meet the criteria set out in s.54(3) of the act, full ad valorem duty will be payable on the transfer of any dutiable property as a result of the change. Ad valorem means the duty is levied in proportion to the value of the property which is subject of the tax.
These changes affect super funds based in NSW or based elsewhere but with dutiable property in NSW. "Dutiable property" can generally be summarised as land, private company shares, units in a unit trust, business assets, statutory licences, an interest in a partnership and a number of other specific matters. If you are not sure whether a specific instance qualifies then you need to contact us.
To enjoy the $50 stamp duty concession and not pay full ad valorem rates of duty there are three criteria which must be met and which can generally be summarised as:
- non of the continuing trustees (remaining after the retirement of a trustee) can be or become a beneficiary under the trust;
- none of the new trustees can be or become a beneficiary under the trust; and
- the transfer is not part of a scheme to avoid these provisions.
You can see the argument in favour of using a corporate trustee for your SMSF - given the state based stamp duty laws this could turn into a really significant issue for SMSFs with individual trustees holding assets in a number of states in Australia with different laws applying.
