There is potential to save $95,000 in NSW landholder duty on planned transfers of shares and unit interests in landholder entities if the parties act quickly to carry out the transfers.
A Bill before NSW Parliament changes the valuation basis of the “threshold” valuation to determine if the entity is a “landholder”. Currently, the threshold is based on the unimproved value of the land. The Bill will change the valuation basis to be the unencumbered value of the land which is often a much higher amount. The effect is that transfers of shares and units in entities with an unimproved land value of less than $2million will be subject to landholder duty if the unencumbered value of the land is $2million or more. For example, landholder duty of $95,000 is payable on transfers of 100% of the interests in a landholder where the unencumbered value of land is $2million.
The duty savings depend upon the transfers (or agreements for them) being made before Assent.