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Unpaid tax interest for transfer duty self assessors

If primary tax (duty) for a dutiable transaction is not paid by its due date, unpaid tax interest (UTI) will accrue daily until the duty is paid in full. UTI may also apply if a document is not lodged on time.

As a transfer duty self assessor, you should understand when UTI applies and how it is calculated so you can clearly explain to your client how their duty liability was determined.

The UTI rate is 8.10% for the 2020-21 financial year.

UTI has 2 components:

  • assessed interest - calculated at the time a transaction is assessed and lodged
  • late payment interest (LPI) - calculated after the transaction has been lodged.

Whether assessed interest or LPI applies to a particular transaction will depend on the following:

  • Lodgement due date - 30 days from the date of the transaction or contract unconditional date
  • Lodgement non-compliance period - the number of days between the lodgement due date and the actual lodgement date
  • Actual lodgement date - the date when a transaction statement is
    • lodged in OSR Online
    • or
    • received in our office (if you are a paper lodger)
  • Transaction payment due date - 14 days after you lodge the transaction statement, even if the transaction is lodged early.

Use our transfer duty calculator to work out the UTI component of a transaction before entering it into OSR Online.

Liability for UTI

The parties to a transaction are liable for the duty, interest and penalties on that transaction.

How UTI is applied

UTI accrues from the UTI start date, which is worked out by deducting the lodgement non-compliance period (in days) from the transaction payment due date. The UTI start date will be shown on your transaction summary statement if you lodge through OSR Online.

Assessed interest

When you lodge a transaction late (i.e. after 30 days from either the date of the transaction or when it became unconditional), assessed interest will apply if the UTI start date is before the lodgement/assessment date.

Example

A transaction is lodged in OSR Online on 10 December 2020, which is 50 days late - it should have been lodged on 21 October 2020. The payment due date is 24 December (14 days after date of lodgement).

The lodgement non-compliance period is from 22 October (the day after the transaction was due to be lodged) to 10 December (the day the transaction was actually lodged).

The UTI start date is 5 November 2020 (payment due date 24 December minus 50-day non-compliance period). Thirty-six days of interest will be assessed at the time of the assessment - 5 November to 10 December.

Late payment interest (LPI)

If you submit a transaction on time through OSR Online (i.e. within 30 days of transaction or unconditional date), LPI will only accrue after the payment due date. However, where a transaction has been lodged late, LPI will accrue either:

  • from the UTI start date, if the transaction is lodged up to 14 days late
  • or
  • from the lodgement/assessment date, if the transaction is lodged more than 14 days late.

This interest accrues weekly each Sunday until the liability is paid in full.

Using the previous example - where the transaction was lodged on Thursday 10 December (50 days late) - 36 days of assessed interest would be included in the assessment. LPI starts accruing on Sunday, 13 December (calculated from 11 to 13 December) and then every Sunday after that.

If full payment of duty and assessed interest is received on Friday, 11 December, no LPI would accrue.

If payment is made on Thursday, 24 December, LPI would accrue on Sunday, 13 December (calculated from 11 to 13 December) and on Sunday, 20 December (calculated from 14 to 20 December). No LPI would accrue between Monday, 21 December and Thursday, 24 December.

OSR Online cannot forecast if payment will be made on time, so any LPI that accrues after the lodgement/assessment date will not appear on the transaction statement.

Also consider...

Contact

Office of State Revenue
For transfer duty self assessment queries:

For queries on payroll tax, land tax and royalties:

  • call 1300 300 734 (Australia) or +61 7 3179 2500 (overseas)
  • send an email using our online enquiry form.