MGS Private advises on New South Wales (NSW), landholder duty. Landholder duty applies when you acquire a significant interest in a company or unit trust that owns land with an unencumbered value of $2 million or more. Here are the key points:
- Significant Interest:
- A significant interest means that if all the property is distributed, you are entitled to:
- For acquisitions made on or after 1 February 2024:
- 50% or more of the property in a private landholder.
- 20% or more of the property in private unit trust schemes (other than registered wholesale unit trust or imminent wholesale unit trust schemes).
- 90% or more of the property in a public landholder.
- For acquisitions made prior to 1 February 2024:
- 50% or more of the property in a private landholder.
- 90% or more of the property in a public landholder.
- Who Is Liable to Pay Landholder Duty?:
- The following persons are liable:
- The person who makes the relevant acquisition.
- The landholder or the trustee of the landholder.
- If the acquisition results from an aggregation of interests, each of those other persons.
- Calculating Landholder Duty:
- Landholder duty is charged at the same rate as transfer duty.
- It is calculated on the unencumbered value of the landholdings and goods of the landholder at the time of the relevant acquisition.
- A statement period (three years before the acquisition date) determines the number of acquisitions made.
Remember, understanding landholder duty is crucial when acquiring significant interests in landholding entities. Seek professional advice for specific scenarios! Contact MGS Private for assistance.
