Transfer property to spouse to minimise land tax?

I have two NSW properties under my name and wife has 0. My holdings would make me liable to land tax, circa 10k pa. Ideally I would like to transfer one property to her name to avoid land tax. Any suggestions on what I can do?

1) if i transfer to spouse, I will pay stamp duty, which I'm open to, it might make sense financially. If I transfer it at a low sale price, it would affect CGT when we sell it due to low cost base. Any ideas to mitigate this?

2) any trust-based solutions? eg declare I hold the property on trust for spouse

3) any other ideas?

 

You will be taxed at market value for both stamp duty and CGT regardless of transfer price.

Legal Tip 230: Checklist for Transfers between Spouses Legal Tip 230: Checklist for Transfers between Spouses

 

What happens when properties are sold as part of a property separation/divorce settlement ?
Is cgt also divided between the two people benefiting (receiving payment) or just the on paper registered owner) ?

 

If it is just sold it is as per normal.
Rollover relief can apply if transferred between the spouses

 

If you reside in NSW property as your PPOR on the date of transfer and you transfer JUST 50% to your spouse this isnt subject to duty. Some (legal+tax) advice concerning this as a strategy should be obtained as the main residence exemption may or may not also apply to the property. Later the other 50% could also be sold and refresh the costbase but that portion would be dutiable.

Tip - If you engage with Terry as your broker to refinance such a event he may advise you and assist.

 

semi seriously considering a fake divorce lol

 

Thanks for suggesting. The property's been rented out since 2020 so it's been almost 2 years as an IP. Should I still look into this pathway?

Are there any other avenues to pursue, eg declare a trust

 

I can think of 2 strategies

Tax Tip 50: Minimising duty on Spousal Transfers Tax Tip 50: Minimising duty on Spousal Transfers

and

Aparent purchaser provision of the NSW Duties act - if the non-owner of you paid the deposit and repayments it could be transferred without duty, or if both of you did then it could be transferred into 2 names without duty - potentially.

A declaration of trust would result in duty
Tax Tip 217: Declarations of Trust and Stamp Duty Tax Tip 217: Declarations of Trust and Stamp Duty


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