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It depends. It is always important to review the requirements of the Duties Act in each case before assuming that a rural land transfer will be stamp duty free.
Mum and dad have owned a rural property since the 1970s. The farming business is carried on by a proprietary limited company. The shareholders and directors are mum and dad.
As the son and daughter-in-law now run and guide the farming business, mum and dad have decided to transfer part of the farming land to them valued at about $1.5 million. Mum and dad also propose to make the son and daughter-in-law directors of the farming operations company.
Mr Farmer died in 1988 leaving the farm to his wife during her life time and then to his son after her death. The son has worked on the family farm since childhood and is now in his late forties.
As the son does not own the family farm, he has had difficulties negotiating funding with his bank because of his mother’s life interest.
His mother agrees to surrender her life interest in the family farm during her lifetime, to enable the legal estate in the family farm to be passed to her son.
Stamp duty on the transfer of mum’s interest to the son is exempt under the inter-generational stamp duty exemption for primary production land.… Read More