cimWell if you haven't already done so;
We usually send our clients ALL the required 'wet-ink' paperwork with our initial postal package. Sometimes we need to allow for the other party to complete certain forms first, so thanks for your patience and understanding if you receive more than one form requiring 'wet-ink' execution.
That Loan Amount on the Unconditional/Formal approval is usually NOT the exact amount your lender will make Available as Funds (aka funds your lender will bring) for Settlement.
The Lender will usually take their fees and costs out of that approved Loan Amount this effectively reduces the Available Funds at settlement. Which may mean that the Buyer might have a 'Client contribution', or 'Funds to complete', or sometimes misnamed as additional 'Deposit' (Deposit as defined under your contract is to be held by the Deposit Stakeholder).
So if there is a 'Client Contribution', then best become aware of the expected difference on the required balance you will need Contribute towards settlement.
We often are not advised of the exact amount the lender will bring to Settlement, till much closer to settlement -often not till morning of settleemnt. However your broker/banker who setup the loan would have the best idea of that amount, and will have usually calculated to some best efforts the amount you will need to contribute. So the next query;
However some lenders / circumstances will not cater for that, in which case our trust account for your contribution is the only other way, these deposits normally take the banks upto three (3) business days to clear those funds. There is a quicker process referred to as Real Time Gross Settlement (RTGS) which allows for funds to be cleared usually by same or at least next business day- if beating for the transferring bank cut-off.
Attend to conditions especially before any expire. ie Termite or Building Inspections, due diligence clause, etc.. and confirm with both the Real Estate Agent and also A1 Conveyancing, once done.
Sellers; Make Sure that your Discharge Authority has been completed and A1 Conveyancing have been sent a copy.
Complete and obligations under your contract and confirm with both the Real Estate Agent and also A1 Conveyancing, once done.
"Buyers can generally move into the property once settlement has taken place, unless the O̶ ̶&̶ ̶A̶ ̶o̶t̶h̶e̶r̶w̶i̶s̶e̶ ̶s̶p̶e̶c̶i̶f̶i̶e̶s̶ ̶o̶r̶ ̶t̶h̶e̶ ̶h̶o̶m̶e̶ ̶i̶s̶ ̶t̶h̶e̶ ̶s̶e̶l̶l̶e̶r̶’̶s̶ ̶r̶e̶s̶i̶d̶e̶n̶c̶e̶ Seller occupied as their 'principal place of residence' immediately prior to Settlement. If this is the case the seller may remain until noon on the day after settlement.
However, buyers sometimes reach agreement with the seller to move into the property earlier than the settlement date. Buyers who are considering taking possession of a property prior to settlement may be asked to sign a form which states that the buyer agrees to take the property ‘as is’, and a statement that the buyer makes their offer unconditional.
Consequently, the seller may not be required to fulfil any special conditions which have been inserted into the O & A.
Both the seller and the buyer should seek legal advice about the potential problems that could arise from prior possession and consider the risks carefully."
Imagine you are in the biggest city you know, on the busiest street, outside the biggest bank which you notice is surrounded with cameras and not just armed, but heavily armed security guards and some restrained but excited & vicious looking dogs.
The Bank doors open, a few moments later, from the secure confines of the building, out walks a petite and cheerful person pushing in front of them a wheelbarrow full of money, out on to the street. You immediately notice the passers-by around them, become onlookers. As they begin to stare perhaps hope that some of those loose notes blow off the top for them to collect at their whim. But if you were to look down the dark alleyways and side lanes you might find some bigger threats to that person losing their funds.
This cheerful person is off to buy the property of their dreams, they have arranged to meet the Seller, to exchange funds for Title of their intended property purchase just a few blocks up the terrace of this same street.
You begin to notice some spectre like characters, seem to condensate, perhaps out of the side lanes and alleyways, but now just happen to be walking past, as they take more interest than they should.
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.
Cyber thieves are clever. They target lawyers because we direct transfers of money and they want to steal it.
DON’T FALL FOR IT!
Be suspicious of email instructions.
Cyber fraudsters will get in any way they can. Make sure it’s not through you.
Five steps to protect yourself.
On or after 1 July 2018, certain purchasers of new residential premises or potential residential land will be required to withhold an amount from the price of the supply for payment to us.
Note: When we refer to purchasers we are also referring to lessees under long-term leases.
The withholding amount is due on or before the day that consideration for the supply (other than a deposit) is first provided. If the contract is an instalment contract that will be the day the first instalment is paid otherwise it will be the day of settlement.
Suppliers will be required to assist their purchasers to comply by notifying them whether or not they have a withholding obligation on supplies of certain kinds of residential premises and potential residential land. Where there is a withholding obligation, the supplier must notify the purchaser of the amount they must withhold, when they must pay it to us, and of certain other particulars.
The amount a purchaser must withhold and pay to us is generally either:
1/11th of the contract price (for fully taxable supplies)
7% of the contract price (for margin scheme supplies), or
10% of GST exclusive market value of the supply (for supplies between associates for consideration less than GST inclusive market value).
Purchasers do not need to register for GST just because they have a withholding requirement.
Transitional arrangements apply to contracts entered into before 1 July 2018.
Find out about:
Transitional arrangements for property contracts entered into before 1 July 2018
How the measure will work from 1 July 2018
When the contract doesn’t settle
No additional payment on top of the agreed purchase price
Information for suppliers and their representatives
Information for purchasers and their representatives
Video: GST withholding for certain taxable sales of property (External Link)
ATO podcast – Tax inVoice – Episode 4 – GST at settlement
GST at settlement webinar (External Link)
Authorised by the Australian Government, Canberra
The GST withholding obligation was announced in the May 2017 Federal Budget.
It is directed at non-compliance by property suppliers who sell properties for a price that includes the GST but who avoid remitting the GST by dissolving their businesses before their next BAS lodgment. This is a form of phoenixing.
Information for settlement agents
Source: 10/5/2018 Department of Finance website HERE
“The formal billing schedule for land tax assessments is generally between October and December each year. As such, a 'Certificate of Land Tax Charges' issued prior to an assessment will always be an estimate.
Consider whether any exemptions may apply to the property being sold.
Single ownership rate of land tax
A 'Certificate of Land Tax Charges' will include both the proportionate land tax and the single ownership figure. If you are a managing agent, the latter can also be obtained by inserting the unimproved valuation of the land and the appropriate assessment year into the land tax calculator.
If a 'Certificate of Land Tax Charges' is issued for a property with a memorial registered under section 76 of the Taxation Administration Act 2003, please contact the Recovery Branch to obtain important information.”
Source: 10th May 2018 AICWA e-Newsletter
How will you manage change in 2018?
Are you ready for:
What will the rest of 2018 serve up to conveyancers?
Don’t get left behind!
AICWA is proud to have partnered with sponsors and key industry stakeholders to deliver a broad calendar of training events. We are committed to assisting you by delivering quality training outcomes as well as providing regular updates. As the peak industry body representing conveyancers locally and nationally, our access to key industry stakeholders means we are best positioned to deliver the knowledge you need.
Source: 9th February AICWA Education e-Newsletter
REIWA are updating their 2011 Standard General Conditions that accompany their Offer and Acceptance Contracts. As of 13/2/18 we are advised the New 2018 Joint Form of General Conditions will be made available from their REIWA office or by license from PrintForce.
REIWA are offering courses for the Real Estate industry to update themselves on the changes; Understand how the changes to JFGC will impact the following:
AICWA are offering an update to industry here;
JFGC’s Info Session
An Evening With Matthew Ellis
With the anticipated amendments to the Joint Form of General Conditions, AICWA have teamed with our very special sponsor and respected lawyer Mr Matthew Ellis – Director MGB Legal.
Matthew will discuss the relevant changes and how they apply to your clients and to you.
Date: 20th February, arrive 6pm, start 6:30 finish 8:30pm (included is a 30min Q&A)
Where: Technology Park - 2 Brodie-Hall Dr, Bentley
Cost: FREE for AICWA members and staff. Please register: HERE or email us at email@example.com
Non-member cost $50 per person. Registration via the AICWA website HERE
Light refreshments available on arrival.
Keep me updated, join us here...