Top Nav

Google Rating
Based on 55 reviews

Developer Stamp Duty Update – Economic Entitlements

There have been significant stamp duty changes in Victoria dealing with “economic entitlements”.

Under the new rules, a person (or company or trust) acquires an economic entitlement where they enters into an arrangement in relation to land with value exceeding $1 million and they are entitled to:

  • share in the income, rents or profits derived from the land;
  • share in the capital growth of the land;
  • share in the proceeds of sale of the land;
  • receive any amount or entitlement determined by reference to the above amounts; or
  • acquire an entitlement to any of the above amounts.

Unlike the previous rules, there is no threshold for the economic entitlement acquired (previously 50%) and the rules can apply to any type of landowner (not just unit trusts and private companies).

Developers must therefore be careful when using property development agreements, as there may be an upfront stamp duty cost when entering into the agreement. Further, property development agreements going forward will need to be drafted carefully to ensure that duty is not chargeable as though the developer has acquired a 100% interest in the relevant land (which it will be deemed to be unless expressly sated otherwise) .

Tip!! Contact us if you are considering any development or similar transactions concerning Victorian land so we can assist you with navigating the “economic entitlement” duty provisions.

6 Responses to Developer Stamp Duty Update – Economic Entitlements

  1. California Pools July 6, 2020 at 11:50 am #

    whoah this weblog is wonderful i love reading your
    posts. Stay up the good work! You recognize, many individuals are looking round for this information, you can aid them greatly.

    • Kari July 16, 2020 at 11:07 am #

      Thank you for the feedback. Please share with anyone you think will benefit!

  2. Appreciation to my father who shared with me concerning this website, this
    webpage is actually amazing.

    • Kari July 16, 2020 at 11:24 am #

      Thank you!

  3. Jim July 12, 2020 at 4:33 pm #

    Ahaa, its good dialogue regarding this paragraph at this place at this website, I have
    read all that, so now me also commenting at this place.
    These are genuinely enormous ideas in on the
    topic of blogging. You have touched some fastidious things
    here. Any way keep up wrinting. I will immediately take hold of your rss feed as I can not
    in finding your email subscription link or newsletter service.
    Do you’ve any? Kindly allow me know in order that
    I may just subscribe. Thanks.

    Here is my blog … Jim

Leave a Reply

Alphastream Lawyers
Google Rating
Based on 55 reviews