On 1 January 2019, foreign transfer duty and foreign landholder duty came into effect by amending the Duties Act 2008. The additional 7% duty applies to acquisitions of residential property where the buyer or transferee are foreign persons, including foreign companies and trusts.
What does this mean to you?
Every buyer or transferee that acquires or purchases land in Western Australia is now required to complete and lodge a Foreign Transfer Duty Declaration Form within two months of executing the dutiable transaction.
The amendments to the TLA have achieved a second reading in Parliament.
This Bill aims to amend three key areas of the Transfer of Land Act 1893 (TLA). It:
1. Modifies the definition of counterpart documents to improve the processing of mortgages electronically;
2. Enables electronic service of many types of notice under the TLA; and
3. Removes duplicate certificates of title from the conveyancing process, resulting in greater ability to conduct land transactions in a fully electronic environment.
In its submission to Landgate AICWA called for additional amendments such as:
Marked-up TLA can be viewed HERE
The Explanatory Memorandum can be viewed HERE
Source:6th December 2018 AICWA e-Newsletter
Source: 6th December 2018 AICWA e-Newsletter
CIRCULAR 17 DUTIES ACT 2008
Foreign Buyers Duty
The Duties Amendment (Additional Duty for Foreign Persons) Bill 2018 (‘the Bill’) was second read into Parliament on 13 June 2018. The Bill operates to amend the Duties Act 2008 (‘Duties Act’) to impose additional duty on certain transactions involving foreign persons or entities acquiring residential property in Western Australia.
These amendments are subject to the passing of the Bill by Parliament and the granting of Royal Assent. The changes are proposed to come into effect on 1 January 2019.
The information provided in this circular is not an exhaustive explanation of the amendments, and reference should be made to the Bill and the Explanatory Memorandum available on the Western Australian Parliament website.
READ MORE HERE
Duty Training Sessions
AICWA will be liaising with OSR to deliver training opportunities to facilitate the Foreign Buyer Duty remittance. Stay tuned for more!
Source:10th October 2018 AICWA e-Newsletter
Just a reminder that GST is now a query of every Residential contract dated on & post 1/7/18.
Not just the obvious ‘new land or new builds’, since ‘New Residential Premises’ under the Taxation administration act, may still be quite aged properties!
“The term ‘new residential premises’ is defined in s 40-75 of the GST Act:
Residential premises are new residential premises if they:
a. have not previously been sold as residential premises and have not previously been the subject of a long-term lease; or
b. have been created through substantial renovations of a building; or
c. have been built, or contain a building that has been built, to replace demolished premises on the same land.”
The AICWA have created a ‘Seller’s Notice to Buyer’ seems to be more direct about if GST is applicable or not?
Either way this new ruling is not well known, nor tested so watch this space as it is likely to develop further as time goes on.
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Regulated products and services
From 1 July 2018, Landgate’s regulated fees are due to increase approximately 1.5 per cent,
in line with the average forecast rate of the Consumer Price Index (CPI).
The proposed fees are available on our website. Please be aware these are subject to
approval from the Governor in Executive Council and publishing in the Government Gazette.
Deloitte Access Economics have delivered a paper on the “Impacts of e-Conveyancing on the conveyancing industry”. Current net benefit in WA is indicated as being in the negative, but future expectations for 2020-21, where usage increases to 100%, predicts a turnaround 400 times greater than the current benefit experienced by the industry.
The cost to practitioners of having to abandon an electronic workspace is also estimated at $69, however, it was estimated that a practitioner could benefit from time saving of 3.5 hours per transaction. In the absence of a comprehensive time and motion study with a significant and diverse sample set of the industry these figures are hard to justify.
How do we now ensure greater benefit so as to turn the current negative into a positive?
What strategies, improvements and initiatives need to be undertaken to make e-conveyancing a success in WA?
Sympli - New e-Settlement Platform on the horizon
InfoTrack and the ASX Limited have announced the establishment of Sympli, an alternative electronic settlement platform.
The new platform is expected to roll out later this year once it has received regulatory approval.
For further information see:
Today's press release
Thanks to the R.E.I.W.A. in depth analysis...
‘Business as usual’ budget fails to reinvigorate property market.
REIWA welcomes the WA Government’s decision not to increase property taxes, but is disappointed in the distinct lack of leadership on display in the 2018-19 State Budget, with no new initiatives included to address housing affordability or reinvigorate the property sector.
REIWA President Hayden Groves said while it was pleasing there were no increases to property taxes, this year’s budget was a mundane budget for the property market.
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