The Victorian Civil and Administrative Tribunal has affirmed the Commissioner’s stamp duty assessments in relation to transfers of real property (referred to as the “reverse transfers”) from 3 family members to a taxpayer (a trustee company of a family trust).
The background facts are complicated, but essentially involved a series of events, which occurred following legal proceedings between the family and one of the sons (which eventually settled). In December 2009, the taxpayer executed 4 transfers of land in respect of the subject property to Mr & Mrs M and another son (“the first transfers”). The son’s evidence was that the transfers were signed and given to the taxpayer’s then solicitors to hold until the court settlement was complete on 30 June 2010 and then to register the same. However, according to the son’s evidence, the transfers were “mistakenly” stamped and registered in January/February 2010.
In May 2010, after changing solicitors, the taxpayer sought a private binding ruling from the Commissioner as to whether transfers back to the trust “to rectify the errors” would be exempt from duty. As part of that request, signed transfers were included “solely for the purpose” of the ruling request (the “reverse transfers”). However, the Commissioner assessed the “reverse transfers” as dutiable transactions pursuant to s 7(1) and (2) of the Duties Act 2000 (Vic).
The Tribunal concluded that the reverse transfers created a transaction, which attracted duty.
(Floridia Enterprises Pty Ltd v Comr of State Revenue (Taxation) [2012] VCAT 1574, Victorian Civil and Administrative Tribunal, Davis SM, 16 October 2012.)
[LTN 226, 21/11]