Part 4BAcquisition of economic entitlements in relation to relevant land

Part 4B—Acquisition of economic entitlements in relation to relevant land S. 32XA inserted by No. 17/2019 s. 10. 32XA Application of Part This Part applies if a person acquires an economic entitlement in relation to relevant land other than by a transaction that is a dutiable transaction apart from this Part. S. 32XB inserted by No. 17/2019 s. 10. 32XB Definition In this Part— ***relevant land*** means dutiable property referred to in section 10(1)(a), (ab), (ac) or (ad). S. 32XC inserted by No. 17/2019 s. 10. 32XC What is an economic entitlement? (1) For the purposes of this Part, a person acquires an ***economic entitlement*** if— (a) an arrangement is made in relation to relevant land that has an unencumbered value that exceeds $1 000 000; and (b) under that arrangement the person is or will be entitled, whether directly or through another person, to any one or more of the following— (i) to participate in the income, rents or profits derived from the relevant land; (ii) to participate in the capital growth of the relevant land; (iii) to participate in the proceeds of sale of the relevant land; (iv) to receive any amount determined by reference to subparagraphs (i), (ii) or (iii); (v) to acquire any entitlement described in subparagraph (i), (ii), (iii) or (iv). (2) It is immaterial whether or not the person who acquires the economic entitlement is a party to the arrangement by which it is acquired. (3) For the avoidance of doubt, a person may acquire an economic entitlement by any means, including, but not limited to, the creation of the economic entitlement or the transfer of the economic entitlement to the person. S. 32XD inserted by No. 17/2019 s. 10. 32XD Economic entitlement taken to be beneficial ownership of relevant land (1) A person who acquires an economic entitlement in relation to relevant land is taken to have acquired beneficial ownership of the relevant land and, subject to this Part, duty is chargeable under this Chapter accordingly. (2) For the purposes of subsection (1), the beneficial ownership of the relevant land that a person is taken to have acquired is a percentage determined under section 32XE. S. 32XE inserted by No. 17/2019 s. 10. 32XE Calculation of percentage of beneficial ownership taken to have been acquired (1) Subject to subsection (2), the beneficial ownership acquired under an economic entitlement is the percentage of the total of all entitlements referred to in section 32XC(1)(b)(i), (ii), (iii), (iv) or (v) (as the case requires) that the person is or will be entitled to receive or acquire under the economic entitlement. (2) The beneficial ownership acquired under an economic entitlement is 100% if— (a) the arrangement under which the economic entitlement is acquired does not specify the percentage of the economic entitlement referred to in subsection (1); or (b) the arrangement under which the economic entitlement is acquired, in addition to specifying the percentage of the economic entitlement referred to in subsection (1), includes any other entitlement of, or amount payable to, the person or an associated person; or (c) the arrangement under which the economic entitlement is acquired entitles the person or an associated person to 2 or more of the entitlements referred to in section 32XC(1)(b)(i), (ii), (iii), (iv) and (v). (3) Despite subsection (2), the Commissioner may determine a lesser percentage than the percentage referred to in that subsection in any particular case if the Commissioner considers it appropriate in the circumstances. S. 32XF inserted by No. 17/2019 s. 10. 32XF Dutiable value of relevant land to which an economic entitlement relates Despite section 20, the dutiable value of relevant land to which an economic entitlement relates is the unencumbered value of the relevant land at the time that the economic entitlement is acquired. S. 32XG inserted by No. 17/2019 s. 10. 32XG Phasing-in of duty If the unencumbered value of relevant land in relation to which an economic entitlement is acquired exceeds $1 000 000 but does not exceed $2 000 000, duty is chargeable under this Chapter in accordance with the following formula— **A** is the unencumbered value of the relevant land; **B** is the duty that, apart from this section, would be chargeable under this Chapter on the acquisition of the economic entitlement. S. 32XH inserted by No. 17/2019 s. 10. 32XH Aggregation of dutiable transactions Section 24(2) does not apply in relation to the aggregation of dutiable transactions under section 24 if any of the dutiable transactions subject to aggregation are dutiable transactions because of this Part. S. 32XI inserted by No. 17/2019 s. 10. 32XI Reduction of duty on subsequent transfer of relevant land to person holding economic entitlement The amount of duty payable on a transfer of relevant land to a person who, before the transfer, held an economic entitlement in relation to the relevant land is to be reduced by the amount of duty the person paid under this Part in respect of the acquisition of the relevant entitlement to the extent that, after the transfer, the beneficial ownership of the relevant land represented by the economic entitlement is held as a result of the transfer rather than under the arrangement giving rise to the economic entitlement. Part 5—Exemptions and concessional rates of duty Division 1—Trusts S. 32XJ inserted by No. 18/2023 s. 6. 32XJ Definitions S. 32XJ def. of *principal beneficiary* repealed by No. 50/2024 s. 14. ***residence requirement*** means the requirement referred to in section 38AC as varied (if at all) by the Commissioner under section 38AD. S. 32Y inserted by No. 39/2009 s. 8.