Makes me laugh that "the Federal Government will strengthen compliance" BY MAKING OTHER PEOPLE DO THEIR JOB!!!! Yet another coming tax trap for buyers of new properties. GST Withholding.
From 1 July 2018, the Federal Government will strengthen compliance with the Goods & Service Tax (GST) law by requiring purchasers of newly constructed residential properties or new subdivisions to remit the GST directly to the Australian Taxation Office (ATO) as part of settlement. Under the current law (where the GST is included in the purchase price and the developer remits the GST to the ATO), some developers are failing to remit the GST to the ATO despite having claimed GST credits on their construction costs.
The measure will require the purchaser of newly constructed residential properties of new subdivisions to remit the GST on the purchase price directly to the ATO as part of Settlement for contracts on or after July 1, 2018.
Like a scene from a piece of famous literature, Landgate will be scoped, to see what the current government can scrape together to prop up their budget.
Media statement here.
Other States media articles include;
From July 1 2017, new Commonwealth Government reporting requirements will be introduced that will affect all real estate property transfers in Western Australia.
The reporting requirements are being introduced following agreement by Commonwealth, State and Territory Treasurers to establish a National Register of Foreign Ownership of Land Titles. This Register will be administered nationally by the ATO. In WA, Landgate will collect and report the required information to the ATO.
For each transaction of freehold (and some leasehold interests)
AICWA recently advised members of the decision by The Registrar of Titles Ms Jean Villani to introduce a change of lodgement processes by August 1st 2017.
On August 1st this year, Landgate introduced changes to lodgement process affecting mortgagees, specifically, for the electronic lodgement of mortgages and discharges of mortgages (via PEXA).
It is now envisaged that the next step towards paperless conveyancing is for the scope of eligible document types to be broadened so as to include:
Landgate is seeking comments and feedback from the AICWA on the proposed change. While the finer details of the process have yet to be determined Landgate have indicated that they wish to understand what potential issues or considerations exist in implementing this “next step”. An investigation followed by a lengthy consultation period will hopeful ensure the creation of processes that are accepted by the majority of AICWA members. It is important to note that there are many external impacts that will result from this change that impact conveyancers. Landgate are keen to understand these impacts and where possible work with AICWA to achieve or facilitate positive outcomes.
'Talking property', link to previous POD cast including 6/8/16 talking about Title Insurance :)
#A1Conveyancing #SettlementsWA #SettlementAgent
Listed, Sold or buying a property market value of $2 mil. or over?-ATO clearance certificate is required!
Contracts dated 1 July 16 on wards, will have the new requirements on ALL transactions with market value of $2 million or over.
Unless the Seller provides an Australian Taxation Office (ATO) 'clearance certificate' for each registered proprietors name (matched to the title) to the buyer 2 business days prior to settlement (-timing subject to REIWA special condition).
Then the Buyer must withhold 10% of the Purchase price (more specifically the 'First element of the cost base'-Capital Gains Tax defined term) from the Seller and apply for an ATO Payment Reference Number (PRN) then remit that payment to the ATO once settled, and before Title registration.
Even if Selling or Buying a percentage, where a total property value (aggregated/extrapolated) $2 million or more would likely impact that transaction.
Designed to catch Tax evaders, the new law places liability on the Buyers to withhold payment from the Seller unless they are given a clearance certificate, or exempted by approved variation.
In this series of articles on the Strata Titles Act Reform project, we are bringing you details of the amendments that will impact strata communities across Western Australia. Our previous articles and online videos have already covered other areas of the reforms including:
the new forms of strata: community title schemes and leasehold strata
clearer and easier ways to resolve disputes
terminations of schemes
staged strata development.
Client not on notice of proposed heritage listing
Our client purchased an original 1950s style home in SA with the intent of demolishing it and building their dream home. The client exchanged contracts and began to prepare plans for their new home. Shortly after settlement, the client submitted plans to the Council to construct their dream home. The plans were rejected by Council on the basis of a proposed heritage listing, which was applied just prior to settlement. The client was in shock and immediately contacted their conveyancer.
What did First Title do?
On assessment of the claim, it was revealed the conveyancer and the client were not on notice of the proposed heritage listing of the property as the certificates from Council relied on were not up to date. First Title engaged a lawyer and expert heritage architect in support of an application seeking to overturn the proposed heritage listing.
What was the resolution?
First Title accepted the claim pursuant to its 'heritage cover' on the basis that the client was not on notice that the house was heritage listed. First Title paid for all costs associated with successfully overturning the proposed heritage listing, including legal and expert evidence fees.
Total payment exceeded $11,000
Registration Gap - Third Party Claim
One day after purchasing his home in WA, our client learned he could not become the registered owner of his property due to a third party claim. Our client was informed by his conveyancer that the stepchildren of the vendor registered a testamentary right to his property. The children claimed they were gifted the property in their mother's will. The children refused to remove their interest in the land unless they were given money from the sale of our client's property.
What did First Title do?
On assessment of the claim, it was revealed the conveyancer and the client were not on notice of a potential third party interest in the property. First Title engaged a lawyer to ensure our client would become the registered owner of the property and to put the potential interest of the vendor's stepchildren in the property to rest.
What was the resolution?
First Title accepted the claim pursuant to its 'registration gap' coverage on the basis that between settlement and registration of our client's transfer to our client's name another interest was registered on the property title. First Title paid for all costs associated with successfully settling the dispute over the client's property through mediation.
Payment to date exceeds $20,000
For more information on First Title's insurance options call us on
1300 362 178. Alternatively, you can visit our website.
Source: email News from First Title: Claims Chronicles - May 2016
Watch this presentation for an overview of the proposed strata reforms.
The WA Government has given Landgate responsibility for delivering reforms to Western Australia's Strata Titles Act 1985.
The proposed reforms aim to provide more flexible and sustainable housing options to benefit developers, strata owners, investors, residents and tenants. They aim to improve the way strata schemes work but not to change current strata owners' land titles and boundaries.
Keep me updated, join us here...