The Qld Civil and Administrative Tribunal has denied a taxpayer’s claim for an exemption from duty to correct a “clerical error” under s 152 of the Duties Act 2001 (Qld).
The taxpayer had sought the exemption following a discovery by the taxpayer’s accountant that the subject investment property was held in the names of the taxpayer and his wife as joint tenants (which resulted in a disadvantageous tax position for the taxpayer who was the main household breadwinner). The couple executed a transfer of the property from themselves to themselves but with the property to be held as tenants in common in shares as to the taxpayer 99/100 and the wife 1/100. However, the Commissioner assessed duty on a transfer of 49% of the property. The taxpayer claimed it was an “honest mistake” that “joint tenants” was circled on the solicitor instruction form (and not “tenants in common”) in preparation of the transfer, and the couple had always intended to follow the advice of their financial advisers.
The Tribunal was of the view that the couple had decided to buy the investment property in both names, but did not understand that the legal effect of this for tax purposes would limit the deductibility of the expenses. It said this error is not a clerical error in terms of a misdescription of the property or a party to the transaction as required by s 152. (Sherratt v Comr of State Revenue [2013] QCAT 9, Qld Civil and Administrative Tribunal, Allen M, 7 January 2013.)
[LTN 14, 22/1/13]