Residential land concession toolkit

Residential land concession transfers are one of the most common transactions registered self assessors lodge in OSRconnect. Understanding how to correctly assess and lodge these transactions will help your clients correctly claim their entitlements and avoid unpaid tax interest and penalties.

Provided that your clients meet the relevant requirements, they may be able to claim one of these concessions when transferring residential land in Queensland:

Companies cannot claim the home concession.

A trustee can claim a concession only in cases where all the beneficiaries of the trust (not a discretionary or unit trust) are individuals under a legal disability and will occupy the home as their principal place of residence.

Additional duty of 7% applies to acquisitions of residential land by foreign persons (including companies and trusts). Find out more about the additional foreign acquirer duty.

Assessing residential land concessions

Your clients can use our eligibility tester to determine if they can claim a concession for a transfer of land they will use as their home.

We also have a step-by-step procedure that shows you how to apply a residential concession to a transaction in OSRconnect.

Related or associated party transactions

You must get a valuation or evidence of value where:

  • the transaction is between associated or related persons
  • there is no stated consideration for the transaction, or the consideration is far lower than the actual value of the property
  • the consideration cannot be determined when the liability for transfer duty arises.

Different residency requirements

The requirements for the first home and first home vacant land concessions are different to those of the Queensland First Home Owners' Grant. If your client claims a concession for transfer duty and receives the grant, they need to meet both sets of requirements in order to keep both benefits.

Learn the differences between the residency requirements of the first home concessions and Queensland First Home Owners' Grant.

Demolishing a home and building a new one

If your client buys a property with a home on it, demolishes the home on settlement, builds a new one and moves into it, they will not be entitled to the home concession on the home they are buying.

This is because they are not moving into the home that they are buying (i.e. the home that was on the property when they entered into the dutiable transaction for the land) - they are moving into a newly built home.

Two homes on one property

In some cases, people may purchase land large enough to have 2 homes on it. This factor alone does not prevent any of them from claiming a concession. They can make a claim as long as each person can fulfil the concession requirements.

For example, if a father and son buy a large property with 2 homes on it and the father will live in 1 of the homes and the son will live in the other, both can still claim a home concession.

OSRconnect will determine the concessional duty amount when you enter the transaction. See section 93(2) and (6) of the Duties Act 2001 for more information.

Leasehold land

If your client rents a property from a person who owns the land in freehold, generally they cannot claim a home, first home or first home vacant land concession.

But they may be able to claim a concession if they:

  • acquire a 'new right' that is a leasehold interest; for example, they are leasing or subleasing land that is owned by the state (not an individual or company) on a long-term basis
  • and
  • pay a premium, fine or other consideration for the right; this means that they pay a sum upfront, as though they were buying the property. This does not include weekly or periodic rent payments.

Non-Australian entity

When a transaction includes real property, each transferor and transferee must declare whether they are a non-Australian entity.

A non-Australian transferor or transferee must complete an identity details annexure.

For transferors, an electronic annexure is generated through OSRconnect. Select the email option when entering the transferor's email address. Contact us for help if you cannot obtain the transferor's email address.

Transferees must complete an identity details annexure and you must enter these details in OSRconnect.

Forms

Your client may need the following forms to claim a concession:

If, after claiming a concession, a person cannot meet their occupancy requirements, they should complete a notice for reassessment of transfer duty - home, first home or vacant land concession (Form D2.4).

Records you need to keep

For this type of transaction, you must keep:

  • the concession claim form for each applicant
  • evidence of value if the transfer is between related parties
  • an identity details annexure for each non-Australian transferee, if the transaction involves real property.

Find out more about your record keeping obligations.

Public rulings

You may find the following public rulings useful when self assessing residential land transactions:

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.