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 9.96% for the 2018-19 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 OSRconnect
    • 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 OSRconnect.

Liability for UTI

The parties to a transaction are normally liable for any outstanding tax, interest and penalties on that transaction.

As an agent self assessor, you are not personally liable to pay UTI, though you may be liable to pay a penalty amount in certain circumstances.

How UTI is applied

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 may apply.

The start date of the assessed interest is worked out by deducting the lodgement non-compliance period from the transaction payment due date.

Example

A transaction is lodged in OSRconnect on 14 October 2011, which is 50 days late - it should have been lodged on 25 August 2011. The payment due date is 28 October (14 days after date of lodgement).

No UTI applies up to 25 August, so the lodgement non-compliance period is from 26 August to 14 October.

The assessed interest start date is 9 September 2011 (payment due date 28 October minus 50-day non-compliance period). Therefore, 36 days of interest will be assessed at the time of the assessment - 9 September to 14 October.

Late payment interest (LPI)

If you submit a transaction on time through OSRconnect (i.e. within 30 days of transaction or unconditional date), LPI will only accrue after the payment due date. This interest accrues on a daily basis, but is only applied each Sunday until the assessment is paid in full.

However, where a transaction has been lodged late, LPI is applied on the first Sunday following the date the transaction was submitted through OSRconnect, and then each Sunday after that until the assessment is fully paid. This is regardless of the 14-day payment period.

Using the previous example - where the transaction was lodged on 14 October (50 days late) - LPI would apply on Sunday 16 October (including LPI on 14 and 15 October). If full payment of duty and assessed interest was made on Friday 14 October, no further LPI would apply.

Alternatively, if payment was made on 28 October 2011, assessed interest would apply from 9 September to 14 October and LPI would apply from 14 October to 23 October.

The UTI start date will be shown on your lodgement confirmation statement if you lodge through OSRconnect. This could be the date from which:

  • assessed interest is applied (if the transaction is lodged late)
    or
  • LPI will start (if the transaction is lodged on time).

OSRconnect cannot forecast if payment will be made on time, so any LPI applied after the actual lodgement 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.