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Revenue Ruling
Public Ruling

Ruling Number:PUB-DT-2007-2
Title:Extensions of Time to Pay Duty
Tax Line:Duties
Taxation Administration Act
Legislative Reference:Duties Act 2001
Taxation Administration Act 1997
Previous Ruling:PUB-DT-2006-1
Date of Ruling:13/04/2007
Attachments:
    This ruling replaces PUB-DT-2002-10, PUB-DT-2002-11, PUB-DT-2004-1, PUB-DT-2005-5 and PUB-DT-2006-1.

    Preamble

    Section 6(1)(b) of the Duties Act 2001 (the Act) imposes duty on certain transactions including an agreement for the sale (agreement) or transfer of dutiable property, whether conditional or not.

    Section 10 of the Act provides that a liability for duty arises when a transfer of dutiable property occurs. For the purposes of charging duty, section 7 of the Act deems an agreement or transfer to be a transfer of dutiable property at the date the agreement is entered into.

    Section 15 of the Act provides that duty must be paid within 3 months after the liability to pay the duty arises.

    Accordingly, this will require a taxpayer who has entered into an agreement (whether that agreement is conditional or not) to pay duty within 3 months of the date of execution of the said agreement.

    Section 59(1) of the Taxation Administration Act 1997 ("the TAA") allows the Commissioner of State Revenue ("the Commissioner") to extend the time for payment of tax by a taxpayer ("Tax" is defined in section 3 of the TAA to include duty).

    Ruling

    Extensions of time to pay duty are automatically granted in the following cases: -
    1. Where an agreement for sale of land in Tasmania contains a condition precedent which makes the agreement conditional upon the entering into by the purchaser of an agreement for sale of other dutiable property owned by the purchaser.
    2. Where an agreement for sale of land in Tasmania contains a condition precedent which makes the agreement conditional upon the issue of a Certificate of Title by the Recorder of Titles.
    3. Where an agreement for sale of land in Tasmania contains a condition precedent which makes the agreement conditional upon obtaining approval from the relevant municipal council.
    4. Where an agreement for sale of land in Tasmania contains a clause providing for completion (the completion clause) within a specified period after the issue of a Certificate of Title by the Recorder of Titles.
    5. Where an agreement for sale of land in Tasmania is entered into by a First Home Buyer (who is eligible for first home buyer duty concession) under a long-term purchase arrangement.
    6. Where an agreement for sale of land in Tasmania contains a condition precedent which makes the agreement conditional upon obtaining a commercial or statutory licence to operate a business (for example, a Post Office Licence).
    Such agreements are not required to be lodged with the Commissioner or endorsed on Tasmanian Revenue Online (TRO) until 3 months after either:
    1. the said condition precedent or completion clause has been satisfied; or
    2. the assignment of the whole or any part of the purchaser's interest under the agreement; or
    3. the expiration of 12 months after the date of the agreement,
    whichever occurs first.

    Evidence of the date that the condition precedent or completion provision was satisfied must accompany these agreements when they are lodged with the Commissioner for assessment.

    Where endorsed by way of self-assessment on TRO, relevant evidence of the date upon which the condition precedent or completion provision was satisfied must be retained, together with any other evidence requirements set out in TRO.

    Note, if an agreement is dependant on the satisfaction of a condition precedent or a completion provision (mentioned in this Ruling) contained in another (second) agreement relating to the completion of the first agreement (that is, not another agreement which is unrelated to the completion of the first agreement), the condition precedent or the completion provision of the agreement will not be taken to have been satisfied until such time as the condition precedent or completion provision in the second agreement is satisfied.

    Any other request to extend the time for payment of duty (or a request to pay duty by instalments) on an agreement will be considered on a case by case basis pursuant to section 59 of the TAA.

    Enquiries in relation to this Revenue Ruling should be directed to the Revenue Advice and Audit Section on telephone 0362333722 or by e-mail at dutyhelp@treasury.tas.gov.au. Copies of this ruling may be obtained from our Web site at www.sro.tas.gov.au by following the "Revenue Rulings" link.

    All rulings must be read subject to Revenue Ruling PUB-GEN-2005-5.



    W K Sawford
    Commissioner of State Revenue

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