Current as of: 9 March 2022.
When an SMSF investor is looking at investing in a unit trust, careful consideration needs to be given to a number of important factors. We investigate some of these factors including: Related trusts, Part 8 Associates concept, Regulation 13.22, Non-arms length income and Pre-99 unit trusts.
An accountant, a conveyancer and a financial adviser walk into a bar. Kidding. Let me tell you what they really did: they all called Acis in the last few weeks, querying whether a trust established in Queensland needed to be “stamped” in New South Wales before it could acquire property there. It is certainly not an uncommon question for us to receive, but three times in the same number of weeks is definitely higher than usual. In this article we will answer that question, and other questions we regularly receive, in relation to duty and the establishment of trusts.
It is important to note first, however, that our discussions here are limited to:
Answer: No
Any duty on the establishment of a trust is almost always determined by where the trust deed is signed. The New South Wales Duties Act only imposes duty on the establishment of a trust over non-dutiable property if the instrument (trust deed) is “executed in New South Wales”. If a trust deed is wholly executed in Queensland, no duty should be payable in New South Wales in relation to the establishment of that trust – the New South Wales Duties Act cannot “capture” the act of establishing the trust as the trust deed was not executed in “New South Wales”.
As mentioned above, if the trust goes on to acquire property in New South Wales then duty will be payable on that acquisition, in New South Wales. This is distinct, however, from duty payable on the actual establishment of the trust.