What is stamp duty?
Stamp duty (or transfer duty) is a form of government tax that applies to certain transactions. Parties may have to pay stamp duty when they buy or transfer ownership of property.
Traditionally, transfer of real property entails payment of stamp duty. However, separated couples undergoing a property settlement can be exempted from having to pay stamp duty on property settlement.
Is stamp duty payable on a property settlement?
The Duties Act 1997 (NSW) states that there is an exemption on stamp duty upon the breakdown of marriage or de facto relationship.
When, in a family law a property settlement, one party transfers ownership of real property to their former spouse or de facto partner, the party receiving property through the transfer of ownership is not required to pay stamp duty.
Parties seeking this exemption must ensure that the transfer of property is in accordance with a court order or a Financial Agreement.
How do I get the stamp duty exemption?
Parties looking to waive their stamp duty obligations must get a copy of their sealed court order or signed FA which states that one party is to transfer property to their former spouse or partner.
In NSW, parties must engage a solicitor or conveyancer who subscribes to an ELNO to effect a transfer. They will need the following documents:
- Identity documents;
- a completed ‘Purchaser/transferee declaration‘ form;
- a completed ‘Exemption or refund – breakup of a marriage or de facto relationship’ form;
If the solicitor is registered for Electronic Duties Returns they can process the exemption in-house. Revenue NSW will send them a Duties Notice of Assessment and a Duties Statement bearing a duties assessment number. The solicitor enters the number in the ELNO workspace to obtain the exemption from duty.
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Contact us now for free no-obligation initial telephone advice about obtaining a stamp duty exemption as part of your family law property settlement.
