As most of us would be aware, corporate reconstruction exemptions will never be the same again from 1 February 2024 as the NSW Government replaces the 100% exemption with only a 90% reduction.
In other words, a duty liability equivalent to 10% of the duty that would otherwise be payable, will apply going forward.
In light of this, we are finding that a lot of our clients have and are taking the opportunity to structure and implement internal restructures in a manner and timeframe that assists with eliminating the incoming 10% duty leakage (with a pre-existing and broader commercial purpose to do so, of course).
One such client that we recently assisted with was one of Australia’s largest ASX-listed companies, who recently transferred real property assets between group companies to enable more streamlined revenue generation and trading practices. By doing so just before 1 February 2024, they should receive the full benefit of the corporate reconstruction exemption i.e. nil duty should apply.
If you would like to see how we can assist you with such restructures, please let us know. Whilst the changes have now taken effect, there are still transitional provisions in place which may be of assistance to manage your duty exposures. Further, we often find that assets subject to such intra-group transactions are located in various locations across Australia noting that the duty implications and corporate reconstruction exemption rules vary per State. We are able to assist with these matters on a national scale.