Commercial Transfer Duty
From 7 June 2017 - New Commercial Transfer duty rate for Conveyances
From 7 June 2017, a new duty rate applies to commercial property transactions - where the property, the subject of a dutiable transaction is used or will be used, wholly or partly, for commercial purposes.
New duty rate
Where the value of the property transacted is under $1.5 million, the new rate will be half the normal conveyance duty rate.
Where the value of the property is $1.5 million and above, a flat rate of 5% will apply.
A link to Commercial Transfer duty rate table is provided below.
Value of Commercial Property
|up to $200,000||$20 or $0.70 per $100 or part thereof, whichever is greater|
|$200,001 to $300,000||$1,400 plus $1.20 per $100 or part thereof by which the value exceeds $200,000|
|$300,001 to $500,000||$2,600 plus $1.90 per $100 or part thereof by which the value exceeds $300,000|
|$500,001 to $750,000||$6,400 plus $2.39 per $100 or part thereof by which the value exceeds $500,000|
|$750,001 to $1,000,000||$12,375 plus $3.15 per $100 or part thereof by which the value exceeds $750,000|
|$1,000,001 to $1,499,999||$20,250 plus $3.40 per $100 or part thereof by which the value exceeds $1,000,000|
|$1,500,000 and over||A flat rate of $5.00 per $100 applied to the total transaction value|
Meaning of ‘commercial purposes’
This means industrial, business or retail use of property and includes mixed-use. Examples include warehouses, factories (industrial); offices, restaurants, cafes, hotels, commercially run accommodation such as student accommodation, retirement villages, caravan parks (business); shops, shopping centres, retail outlets (retail); shopping centre with apartment tower, two-storey building with an office on the ground floor and a residence on the first floor, farm land with part of it used for a bed and breakfast business (mixed-use).
It excludes properties that are used or that will be used only for residential or primary production purposes. Examples include houses, units, apartments bought off-the-plan (residential); farm land, grazing land (primary production). It also excludes home businesses permitted by the Planning and Development Act 2007, for example a bookkeeping business, or florist working from home.
Meaning of ‘used or will be used’, ‘partly and wholly’
This refers to a purchaser or transferee’s proposed use of the property, and whether the property will be fully, or only partly used for a particular purpose.
The use or proposed use may not necessarily be the permitted use as specified in a Crown lease.
The following scenarios are examples where a property is used or will be used by the purchaser, partly or wholly, for commercial purposes. In each of these scenarios, the new Commercial Transfer duty rate will be used in calculating the duty amount payable.
1. Mr Smith buys land on which there is an existing office building.
2. Mr Jones buys land on which there is an existing building comprised of a suite of offices on the ground floor, and three levels of apartments on levels one, two and three.
3. Ms Chen buys land on which there is an existing farm. She plans to build chalets on part of the land from which to run her bed and breakfast business, while retaining the remainder of the land as a farm.
4. Baker Pty Ltd buys an old warehouse with the intention of converting it into an apartment tower and shopping complex.
Making a Declaration
For property transferred from 7 June 2017 use the Conveyance Lodgement form
Every person who has, or will acquire an interest in the property following the transfer must complete the form and sign the Declaration.
The form must be:
- received by the Access Canberra Dickson Shopfront on behalf of the Commissioner for ACT Revenue (the Commissioner); or
- mailed to the ACT Revenue Office at PO Box 293, Civic Square ACT 2608.
All Conveyance Lodgement forms must be received by the Commissioner by the date the duty must be paid. That is, within:
- 90 days after the transaction date; or
- for an off the plan purchase agreement – within the time that duty is payable for the agreement. This is 14 days after the first of the events mentioned in section 16A (1) of the Duties Act 1999 or a maximum time of 1 year and 14 days after the transaction date.
To enable these transactions to be processed efficiently, please submit complete the Conveyance Lodgement form together with all supporting documents when you lodge documents for duty payment. Incomplete forms will delay processing time.
- Conveyance Lodgement form AF2017-138 (external site)
- Taxation Administration (Amounts Payable – Duty) Determination 2017 (No 1) – DI2017-79 (external site)
- Commercial Transfer rate - Calculator