Duties Act 2008

• Property buyers and sellers: Transfer duty applies to virtually all transfers of WA real property and many other asset transfers. Anyone buying property in WA will be liable for transfer duty calculated on the greater of the purchase price and market value.
• Corporate and trust structures: Companies and trusts that hold WA land assets are affected by the landholder duty provisions. Corporate restructurings, mergers and group transfers must be assessed for landholder duty exposure. Chapter 6 connected entity exemptions provide relief for genuine intragroup transfers.
• Foreign investors: Since 2018, foreign persons acquiring WA residential property pay additional duty on top of general transfer duty. Corporations with significant foreign ownership can also be foreign corporations under Chapter 3A.
• Insurers and insurance intermediaries: Chapter 4 requires duty to be paid on general insurance premiums for WA risks. Insurance intermediaries must account for and remit insurance duty.
• Vehicle dealers and individual owners: Vehicle licence duty applies to the transfer of vehicle licences (Chapter 5).
• Trustees and beneficial owners: Declarations of trust, trust acquisitions and trust surrenders are dutiable. Discretionary trust arrangements, unit trust schemes and self-managed superannuation funds are all affected by different provisions of the Act.
• Resources sector participants: Farm-in transactions in the mining and petroleum sector are specifically addressed as "concessional farm-in transactions" (section 11(1)(j)) with special duty treatment.
• Partnership participants: Partnership acquisitions and the dissolution of partnerships trigger duty consequences. Section 78 provides specific rules for the dutiable value of transfers to retiring partners.
• First homebuyers: Concessions and exemptions are available for first homebuyers under Part 5 of Chapter 2.

Lodgment and assessment. Persons liable to pay duty must lodge a transaction record with the Commissioner within the time limits prescribed by the Taxation Administration Act 2003 and pay the duty assessed. For most property transactions, lodgment occurs through the electronic conveyancing system and settlement agents handle duty payment.

Duty endorsement. A dutiable transaction must be duty endorsed before the transaction can be fully effected for registration purposes (section 272). Without duty endorsement, Landgate will not register a transfer of land.

Intermediary obligations for insurance duty. A general insurer or licensed insurance intermediary must account for insurance duty on premiums collected for WA risks and lodge returns under the Taxation Administration Act 2003.

Vehicle licence duty on transfer. When a vehicle licence is transferred, duty must be assessed and paid before the new licence issues.

Connected entity exemptions require prior approval in some cases. Chapter 6 connected entity exemptions do not apply automatically. Certain conditions must be met and the transaction must be self-assessed or approved by the Commissioner.

The Commissioner of State Revenue has extensive discretionary powers:

• To assess or reassess duty on dutiable transactions.
• To apply the Chapter 7 anti-avoidance provisions to disregard a scheme and assess duty as if the scheme had not been entered into.
• To determine whether an entity is a landholder, and whether a relevant acquisition has occurred under Chapter 3.
• To approve connected entity exemptions and off-the-plan concessions under Chapters 6 and 6A.
• To accept or reject declarations about beneficial interests in property.
• To issue advance rulings under the Taxation Administration Act 2003 on how the Act applies to proposed transactions.

The Act operates within the Taxation Administration Act 2003 enforcement framework. Key consequences of non-compliance include:

• Interest and penalties: Unpaid duty accrues interest at the prescribed rate from the due date. The Taxation Administration Act 2003 imposes shortfall interest and administrative penalties for incorrect assessments, with increased penalties for culpable tax default (for example, intentional disregard of the law or recklessness).
• Anti-avoidance. Under Chapter 7, where a tax avoidance scheme is identified, the Commissioner may assess duty as if the scheme had not been entered into and may impose additional penalties.
• Instruments inadmissible. Under section 272 and related provisions, an instrument that has not been duty endorsed cannot be produced in evidence in legal proceedings (subject to exceptions), nor can it be registered.
• Criminal offences. The Taxation Administration Act 2003 creates criminal offences for tax fraud, tax evasion and failure to lodge returns.

When duty arises. For most transfer duty transactions, liability for duty arises on execution of the dutiable instrument. For landholder duty, liability arises when the relevant acquisition occurs.

Lodgment. Transaction records must be lodged within two months of the dutiable transaction under the Taxation Administration Act 2003, subject to extensions. Settlement agents and conveyancers typically handle lodgment as part of the property settlement process.

Assessment. The Commissioner assesses the duty payable and issues a notice of assessment. Payment is then due within the period stated in the notice.

Objection and review. Persons dissatisfied with an assessment may object within 60 days of service of the notice of assessment (or such extension as the Commissioner allows). Objections that are disallowed can be appealed to the State Administrative Tribunal or the Supreme Court of Western Australia, depending on the nature of the dispute.

Foreign person additional duty. Under Chapter 3A, the additional duty is assessed at the same time as the general transfer duty or landholder duty and is subject to the same lodgment and assessment framework.

• Taxation Administration Act 2003 (WA): Section 4 provides that the Duties Act operates within the administrative framework of the Taxation Administration Act, which governs assessments, objections, reviews, enforcement, penalties and rulings.
• Land Administration Act 1997 (WA): Definitions of diversification lease and diversification lessee are imported by reference (section 3).
• Mining Act 1978 (WA): Derivative mining rights and section 118A are referenced in the definition of land assets (Chapter 3).
• Partnership Act 1895 (WA): Partnership dissolution and its effect on property rights were central to the Rojoda High Court case, which turned on the interaction between the Partnership Act and sections 11(1)(c) and 78 of the Duties Act.
• Corporations Act 2001 (Cth): Definitions of corporation, director, managed investment scheme and related concepts are imported by reference from the Corporations Act throughout the Act.
• Transfer of Land Act 1958 and Electronic Conveyancing Act 2014 (WA): Duty endorsement provisions interact with land title registration. Section 273A addresses electronic conveyancing instruments.
• Australian Citizenship Act 2007 (Cth) and Migration Act 1958 (Cth): Definitions of Australian citizen and visa holder for the foreign person additional duty provisions (Chapter 3A) are imported from Commonwealth law.
• Help to Buy Act 2024 (Cth): Section 11(2)(f) and (g) exclude certain transactions under Help to Buy arrangements from being dutiable transactions (inserted 2024).
• Housing Australia Act 2018 (Cth): Housing Australia is defined by reference to that Act for the Help to Buy exclusion.
• Land Tax Assessment Act 2002 (WA): The definition of "parcel of land" in Chapter 3A (section 205A) cross-references that Act.
• Commonwealth Places (Mirror Taxes Administration) Act 1999 (Cth): Modifications to the anti-avoidance provisions apply at Commonwealth places (endnote references to modifications of sections 268 and following).

Declaration of trust by a partner on dissolution: the Rojoda point. The High Court in Commissioner of State Revenue v Rojoda Pty Ltd [2020] HCA 7 held that deeds by which the surviving partner declared that freehold property (registered in the names of the two legal title-holding partners as joint tenants) was held on trust for the former partners in proportion to their partnership interests amounted to a "declaration of trust" under section 11(1)(c), triggering transfer duty. The partners argued that they already held beneficial interests as partners and no new duty should arise. The majority (Bell, Keane, Nettle and Edelman JJ) and the dissenting judge (Gageler J) gave different answers to the foundational question of the nature of partners' interests in partnership property. The majority upheld the duty assessment. This case is essential for any WA transaction involving partnership dissolution and property.

Landholder threshold is aggregated. The $2 million landholder threshold in Chapter 3 includes the land assets of linked entities, not just the target entity's own holdings. A person acquiring shares in a company that itself holds no land but owns shares in a land-rich subsidiary may still trigger landholder duty.

Foreign person duty applies to trusts. A trust with any foreign trustee or with more than 50% of beneficial entitlements held by foreign persons may be a "foreign trust" under section 205D. This catches many family trusts and discretionary trusts where overseas family members are potential beneficiaries.

Connected entity exemption conditions must continue to be met. Chapter 6 exemptions for transactions between connected entities within a corporate group require that the entities remain related for a period after the transaction. If the relationship breaks down (for example, through a sale of the corporate group), the exemption may be clawed back, triggering a duty liability.

The off-the-plan concession (Chapter 6A) has strict conditions. The concession for duty on off-the-plan purchases of residential property requires the transaction to be an "eligible transaction" under section 2 of Chapter 6A, and the eligible transaction conditions include requirements about the commencement of construction, the nature of the property, and the duty payable must be above the minimum amount. Buyers who assume they qualify without careful analysis may face unexpected duty assessments.

Instruments must be duty endorsed before registration. Section 272 makes duty endorsement a condition precedent to land title registration. Settlement agents who allow settlements to proceed without ensuring duty endorsement expose their clients to the risk of being unable to register the transfer.

Residential property purchase. A buyer purchases a WA house for $950,000. Transfer duty is assessed at the general rate in Schedule 2, applied to the greater of the purchase price and market value. Duty is calculated on a graduated basis under Schedule 2 Division 1. If the buyer is a first homebuyer buying a new property below the relevant threshold, a first homebuyer concession may apply. If the buyer is a foreign individual, additional duty at the rate set by Chapter 3A is also payable.

Corporate restructure with WA land assets. Company A, which holds WA land worth $5 million, is transferred within a corporate group from Parent 1 to Parent 2, both of which are owned 100% by the same ultimate holding company. The transfer is a dutiable transaction (transfer of dutiable property under section 11(1)(a)). However, the parties may apply for the connected entity exemption under Chapter 6, which applies to transfers between entities in the same wholly-owned group, subject to the conditions in that Chapter.

Declaration of trust in partnership dissolution. Following the Rojoda decision, any arrangement by which a surviving partner declares trust over land that was partnership property, or by which partners agree that land held by some of them is held on trust for all in fixed proportions, must be carefully assessed for duty under section 11(1)(c). The amount of duty will depend on the dutiable value, which may be reduced under section 78 for the retiring partner's partnership interest.

Farm-in transaction in the resources sector. A junior explorer (the farmee) is granted a right to earn an interest in a mining tenement held by the farm-in party by spending a specified amount on exploration (the exploration requirement). If the transaction qualifies as a "concessional farm-in transaction" under the conditions in Part 9A of Chapter 2, reduced rates of duty apply. This is designed to reduce the duty burden on exploration-phase transactions in the WA resources sector.