State Taxation Acts Amendment Act 2009

i State Taxation Acts Amendment Act 2009 No. 37 of 2009 TABLE OF PROVISIONS Section Page PART 1—PRELIMINARY 1 1 Purposes 1 2 Commencement 2 PART 2—DUTIES ACT 2000 3 3 What is the consideration for the transfer of dutiable property? 3 4 Provisions for determining consideration 3 5 Deceased estates 3 6 New section 52A inserted 4 52A Joint government enterprise—water saving projects 4 7 Transfers of farms to relatives or charities 4 8 Election to receive eligible pensioner exemption/concession or additional first home owner grant 5 9 Election to receive eligible first home owner exemption/concession or additional first home owner grant 6 10 Exemptions from life insurance duty 7 11 Reassessments—failed instruments 7 PART 3—FIRST HOME OWNER GRANT ACT 2000 9 12 Special eligible transactions 9 13 Amount of grant 12 PART 4—LAND TAX ACT 2005 16 14 Transitional provisions 16 13 Enactments applying to old Act 16 PART 5—REPEAL OF AMENDING ACT 17 15 Repeal of Act 17 ═══════════════ ENDNOTES 18 -- 1 of 19 -- 1 State Taxation Acts Amendment Act 2009 † No. 37 of 2009 [Assented to 30 June 2009] The Parliament of Victoria enacts: PART 1—PRELIMINARY 1 Purposes The main purposes of this Act are— (a) to amend the Duties Act 2000— (i) to clarify the operation of certain provisions in relation to determining consideration for the transfer of dutiable property; Victoria -- 2 of 19 -- Part 1—Preliminary State Taxation Acts Amendment Act 2009 No. 37 of 2009 2 (ii) to clarify the scope of the exemption from duty in relation to deceased estates; (iii) to clarify the circumstances in which the family farm exemption from duty is to apply; (iv) to provide that a policy of life insurance that is an FHSA (first home saver account) is exempt from life insurance duty; (v) to clarify the circumstances in which a reassessment is made in relation to failed instruments; (b) to amend the First Home Owner Grant Act 2000 in relation to eligible transactions and special eligible transactions; (c) to amend the Land Tax Act 2005 to clarify that various Acts and regulations that applied in respect of matters under the Land Tax Act 1958 before the commencement of the Land Tax Act 2005 continue to so apply. 2 Commencement (1) This Act (except sections 8 and 9, Part 3 and Part 4) comes into operation on the day after the day on which it receives the Royal Assent. (2) Sections 8 and 9 and Part 3 come into operation on 1 July 2009. (3) Part 4 is deemed to have come into operation on 1 January 2006. __________________ s. 2 -- 3 of 19 -- Part 2—Duties Act 2000 State Taxation Acts Amendment Act 2009 No. 37 of 2009 3 PART 2—DUTIES ACT 2000 3 What is the consideration for the transfer of dutiable property? In section 21(4A)(c) of the Duties Act 2000, for "any prescribed matters and as to" substitute "(but not limited to)". 4 Provisions for determining consideration In section 32V(4A)(c) of the Duties Act 2000, for "any prescribed matters and as to" substitute "(but not limited to)". 5 Deceased estates After section 42(2) of the Duties Act 2000 insert— "(3) No duty is chargeable under this Chapter in respect of a transfer of dutiable property not made for valuable consideration by a legal personal representative of a deceased person to a beneficiary to the extent that the transfer is made in satisfaction of the beneficiary's entitlement arising under the will of the deceased person or arising on an intestacy.". s. 3 See: Act No. 79/2000. Reprint No. 6 as at 25 July 2007 and amending Act Nos 12/2008, 31/2008, 79/2008 and 84/2008. LawToday: www. legislation. vic.gov.au -- 4 of 19 -- Part 2—Duties Act 2000 State Taxation Acts Amendment Act 2009 No. 37 of 2009 4 6 New section 52A inserted After section 52 of the Duties Act 2000 insert— "52A Joint government enterprise—water saving projects No duty is chargeable under this Chapter in respect of a transfer of dutiable property being an estate in fee simple to a joint government enterprise that has the function of allocating funds for water saving projects if the joint government enterprise acquires the property for the purposes of encouraging water efficiency measures.". 7 Transfers of farms to relatives or charities (1) For section 56(2)(c) of the Duties Act 2000 substitute— "(c) a company (not acting in the capacity of trustee under a trust) all the shares in which are owned by natural persons who are relatives of each other; or (d) a trustee under— (i) a discretionary trust, the capital beneficiaries of which are limited to natural persons who are relatives of each other; or (ii) a fixed trust, the beneficiaries of which are limited to natural persons who are relatives of each other.". (2) In section 56(3)(d) of the Duties Act 2000, after "subsection (2)(c)" insert "or (2)(d)". (3) In section 56(4) of the Duties Act 2000 insert the following definition— "capital beneficiary of a discretionary trust means a person, or a member of a class of person, in whom, by the terms of the trust, the whole or s. 6 -- 5 of 19 -- Part 2—Duties Act 2000 State Taxation Acts Amendment Act 2009 No. 37 of 2009 5 any part of the capital of the trust estate may be vested or remain vested— (a) in the event of the exercise of a power or discretion in favour of the person (whether or not that power is presently exercisable); or (b) in the event that a discretion conferred under the trust is not exercised;". 8 Election to receive eligible pensioner exemption/concession or additional first home owner grant (1) For section 60A(1)(b) of the Duties Act 2000 substitute— "(b) to receive an amount in respect of an eligible transaction (within the meaning of the First Home Owner Grant Act 2000) relating to that land under— (i) section 18(2) or 18(2A) of that Act (or both); or (ii) section 18(2AA) or 18(2B) of that Act (or both).". (2) For section 60A(2)(b) of the Duties Act 2000 substitute— "(b) the amount in respect of the eligible transaction (within the meaning of the First Home Owner Grant Act 2000) under— (i) section 18(2) or (2A) of that Act (or both, as the case requires); or (ii) section 18(2AA) or 18(2B) of that Act (or both, as the case requires).". s. 8 -- 6 of 19 -- Part 2—Duties Act 2000 State Taxation Acts Amendment Act 2009 No. 37 of 2009 6 (3) For section 60A(3) of the Duties Act 2000 substitute— "(3) If the eligible pensioner elects to receive the amount under— (a) section 18(2) or 18(2A) (or both, as the case requires); or (b) section 18(2AA) or 18(2B) (or both, as the case requires)— of the First Home Owner Grant Act 2000, or does not make an election under this section, he or she is not entitled to the exemption or concession under section 59 or 60 (as the case requires) in respect of the transfer.". 9 Election to receive eligible first home owner exemption/concession or additional first home owner grant (1) For section 63B(1)(b) of the Duties Act 2000 substitute— "(b) to receive an amount in respect of an eligible transaction (within the meaning of the First Home Owner Grant Act 2000) relating to that land under— (i) section 18(2) or 18(2A) of that Act (or both); or (ii) section 18(2AA) or 18(2B) of that Act (or both).". (2) For section 63B(2)(b) of the Duties Act 2000 substitute— "(b) the amount in respect of the eligible transaction (within the meaning of the First Home Owner Grant Act 2000) under— s. 9 -- 7 of 19 -- Part 2—Duties Act 2000 State Taxation Acts Amendment Act 2009 No. 37 of 2009 7 (i) section 18(2) or 18(2A) of that Act (or both, as the case requires); or (ii) section 18(2AA) or 18(2B) of that Act (or both, as the case requires).". (3) For section 63B(3) of the Duties Act 2000 substitute— "(3) If the eligible first home owner elects to receive the amount under— (a) section 18(2) or 18(2A) (or both, as the case requires); or (b) section 18(2AA) or 18(2B) (or both, as the case requires)— of the First Home Owner Grant Act 2000, or does not make an election under this section, he or she is not entitled to the exemption or concession under section 62 or 63 (as the case requires) in respect of the transfer.". 10 Exemptions from life insurance duty In section 208 of the Duties Act 2000— (a) in paragraph (b), for "reinsurance." substitute "reinsurance;"; (b) after paragraph (b) insert— "(c) a policy of life insurance that is an FHSA within the meaning of the First Home Saver Accounts Act 2008 of the Commonwealth.". 11 Reassessments—failed instruments For sections 260(1) and 260(2) of the Duties Act 2000 substitute— "(1) The Commissioner may make a reassessment of duty that is charged under this Act in respect of a transfer or transaction if— s. 10 -- 8 of 19 -- Part 2—Duties Act 2000 State Taxation Acts Amendment Act 2009 No. 37 of 2009 8 (a) the Commissioner is satisfied that the instrument that is intended to effect the transfer or transaction has failed to give effect to the transfer or transaction; and (b) an application for reassessment of duty under this subsection is made within 5 years after the initial assessment.". __________________ s. 11 -- 9 of 19 -- Part 3—First Home Owner Grant Act 2000 State Taxation Acts Amendment Act 2009 No. 37 of 2009 9 PART 3—FIRST HOME OWNER GRANT ACT 2000 12 Special eligible transactions For section 13A(1) of the First Home Owner Grant Act 2000 substitute— "(1) An eligible transaction is also a special eligible transaction if it is— (a) a contract for the purchase of a home in the State (other than a contract for an off-the-plan purchase of a new home) entered into— (i) on or after 14 October 2008 and on or before 30 September 2009; or (ii) on or after 1 October 2009 and on or before 31 December 2009; (b) a contract for the purchase of a new residential premises in the State entered into— (i) on or after 14 October 2008 and on or before 30 September 2009; or (ii) on or after 1 October 2009 and on or before 31 December 2009; (c) a comprehensive home building contract for a home in the State entered into— (i) on or after 14 October 2008 and on or before 30 September 2009 and in respect of which— s. 12 See: Act No. 5/2000. Reprint No. 2 as at 26 September 2007 and amending Act Nos 12/2008, 31/2008 and 84/2008. LawToday: www. legislation. vic.gov.au -- 10 of 19 -- Part 3—First Home Owner Grant Act 2000 State Taxation Acts Amendment Act 2009 No. 37 of 2009 10 (A) the construction work commences within 26 weeks from the date that the contract is entered into or a longer period that the Commissioner considers appropriate in the circumstances of the case; and (B) the building work is completed within 18 months of the date of commencement of construction work or a longer period that the Commissioner considers appropriate in the circumstances of the case; or (ii) on or after 1 October 2009 and on or before 31 December 2009 and in respect of which— (A) the construction work commences within 26 weeks from the date that the contract is entered into or a longer period that the Commissioner considers appropriate in the circumstances of the case; and (B) the building work is completed within 18 months of the date of commencement of construction work or a longer period that the Commissioner considers s. 12 -- 11 of 19 -- Part 3—First Home Owner Grant Act 2000 State Taxation Acts Amendment Act 2009 No. 37 of 2009 11 appropriate in the circumstances of the case; or (d) for the building of a home in the State by an owner builder and the building work— (i) is commenced on or after 14 October 2008 and on or before 30 September 2009; and (ii) is completed within 18 months of the commencement of the eligible transaction or a longer period that the Commissioner considers appropriate in the circumstances of the case; or (e) for the building of a home in the State by an owner builder and the building work— (i) is commenced on or after 1 October 2009 and on or before 31 December 2009; and (ii) is completed within 18 months of the commencement of the eligible transaction or a longer period that the Commissioner considers appropriate in the circumstances of the case; or (f) a contract for an off-the-plan purchase of a home in the State and— (i) the contract is entered into on or after 14 October 2008 and on or before 30 June 2009; and (ii) the construction work is completed by 31 December 2010 or a later date that the Commissioner considers s. 12 -- 12 of 19 -- Part 3—First Home Owner Grant Act 2000 State Taxation Acts Amendment Act 2009 No. 37 of 2009 12 appropriate in the circumstances of the case; or (g) a contract for an off-the-plan purchase of a home in the State and— (i) the contract is entered into on or after 1 July 2009 and on or before 30 September 2009; and (ii) the construction work is completed by 31 March 2011 or a later date that the Commissioner considers appropriate in the circumstances of the case; or (h) a contract for an off-the-plan purchase of a home in the State and— (i) the contract is entered into on or after 1 October 2009 and on or before 31 December 2009; and (ii) the construction work is completed by 30 June 2011 or a later date that the Commissioner considers appropriate in the circumstances of the case.". 13 Amount of grant (1) After section 18(2) of the First Home Owner Grant Act 2000 insert— "(2AA) Subject to subsections (3) and (4), if the consideration for the eligible transaction does not exceed $600 000 an additional amount is payable as follows— (a) if the commencement date of the eligible transaction is on or after 1 July 2009 and before 1 July 2010— s. 13 -- 13 of 19 -- Part 3—First Home Owner Grant Act 2000 State Taxation Acts Amendment Act 2009 No. 37 of 2009 13 (i) $11 000 if the eligible transaction is a contract for the purchase of new residential premises or an eligible transaction referred to in section 13(1)(b) or 13(1)(c); or (ii) $2000 in any other case.". (2) After section 18(2A) of the First Home Owner Grant Act 2000 insert— "(2B) Subject to subsections (3) and (4), an additional amount of $4 500 is payable (in addition to any amount payable under subsection (1) or (2AA)) if— (a) the consideration for the eligible transaction does not exceed $600 000; and (b) the commencement date of the eligible transaction is on or after 1 July 2009 and before 1 July 2010; and (c) the eligible transaction is a contract for the purchase of new residential premises or an eligible transaction referred to in section 13(1)(b) or 13(1)(c); and (d) the land on which the premises or home is or will be situated is wholly in regional Victoria.". (3) In sections 18(3), 18(5) and 18(6) of the First Home Owner Grant Act 2000, for "(2) or (2A)" (wherever occurring) substitute "(2), (2AA), (2A) or (2B)". s. 13 -- 14 of 19 -- Part 3—First Home Owner Grant Act 2000 State Taxation Acts Amendment Act 2009 No. 37 of 2009 14 (4) After section 18(4) of the First Home Owner Grant Act 2000 insert— "(4A) Subsection (2AA) or (2B) also does not apply if the Commissioner is satisfied that the contract that formed the basis of the eligible transaction replaces a contract made before 1 July 2009 (the earlier contract), and the earlier contract was— (a) a contract for the purchase of the same home; or (b) a comprehensive home building contract to build the same or a substantially similar home.". (5) For section 18(7) of the First Home Owner Grant Act 2000 substitute— "(7) Subject to subsection (7A), in relation to a special eligible transaction an additional amount is payable as follows— (a) $7000, if section 13A(1)(a)(i) applies to the transaction; or (b) $3500, if section 13A(1)(a)(ii) applies to the transaction; or (c) $14 000, if— (i) section 13A(1)(b)(i), 13A(1)(c)(i), 13A(1)(d), 13A(1)(f) or 13A(1)(g) applies to the transaction; and (ii) the home has not been occupied as a residence since it was constructed, renovated or refurbished; or s. 13 -- 15 of 19 -- Part 3—First Home Owner Grant Act 2000 State Taxation Acts Amendment Act 2009 No. 37 of 2009 15 (d) $7000, if— (i) section 13A(1)(b)(ii), 13A(1)(c)(ii), 13A(1)(e) or 13A(1)(h) applies to the transaction; and (ii) the home has not been occupied as a residence since it was constructed, renovated or refurbished.". __________________ s. 13 -- 16 of 19 -- Part 4—Land Tax Act 2005 State Taxation Acts Amendment Act 2009 No. 37 of 2009 16 PART 4—LAND TAX ACT 2005 14 Transitional provisions In Schedule 3 to the Land Tax Act 2005, after clause 12 insert— "13 Enactments applying to old Act Despite anything to the contrary, the following enactments, as in force immediately before the commencement day, continue to apply on and after that day in respect of any matter to which the old Act continues to apply on and after that day and are taken always to have so applied— (a) Taxation Administration Act 1997 and regulations made under that Act; (b) Taxation (Reciprocal Powers) Act 1987; (c) Victorian Civil and Administrative Tribunal Act 1998 and regulations and rules made under that Act.". __________________ s. 14 See: Act No. 88/2005. Reprint No. 2 as at 18 October 2007 and amending Act Nos 22/2007, 68/2007, 12/2008, 31/2008, 46/2008, 79/2008 and 4/2009. LawToday: www. legislation. vic.gov.au -- 17 of 19 -- Part 5—Repeal of Amending Act State Taxation Acts Amendment Act 2009 No. 37 of 2009 17 PART 5—REPEAL OF AMENDING ACT 15 Repeal of Act This Act is repealed on the first anniversary of its commencement. Note The repeal of this Act does not affect the continuing operation of the amendments made by it (see section 15(1) of the Interpretation of Legislation Act 1984). ═══════════════ s. 15 -- 18 of 19 -- State Taxation Acts Amendment Act 2009 No. 37 of 2009 18 ENDNOTES † Minister's second reading speech— Legislative Assembly: 7 May 2009 Legislative Council: 9 June 2009 The long title for the Bill for this Act was "A Bill for an Act to amend the Duties Act 2000 and other Acts and for other purposes." Endnotes -- 19 of 19 --