Hold property under Company

Discussion in 'Accounting & Tax' started by clubman, 24th Feb, 2020.

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  1. clubman

    clubman Member

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    Hi,

    Currently, I use a company to hold a property for development, I hold 100% of shares. This company does no have anything beside this property, no debts either.

    My friend is interested to be part of this project, he wants to purchase 30-70% of shares off me. Just wondering if we do the transfer of shares through ASIC, are there any stamp duty involved? My lawyer said stamp duty is required coz the ultimate ownership is changed, however my accountant said no stamp duty is required coz there is no transfer of ownership, it's still under the same owner.

    I am confused.

    Clubman
     
  2. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Plus Member

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    There could be duty and CGT.

    In NSW there would be not duty unless the company was classed as a 'landholder'. I don't know the laws in QLD off the top of my head, but would seek the lawyers advice on this as accountantts are not authorised to advise on duty matters.
     
    Ross Forrester likes this.
  3. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Plus Member

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  4. clubman

    clubman Member

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    Ross Forrester likes this.
  5. Mike A

    Mike A Accountant Business Member

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    accountants cannot provide advice on stamp duty. would be a breach of their professional obligations. the lawyer is the person who should be providing the advice.
     
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  6. Paul@PFI

    [email protected] Tax Accounting + SMSF Business Plus Member

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    I cant provide advice on land tax but I can and will caution that a change in shares in a company which owns land in QLD is potentially dutiable. QLD has a indirect duties rule and uses a land rich test like most other states. (ie the shares are attributed to a share of ownership of land) I would seek legal / tax advice prior to acting. There may be merits to consider a option strategy.