When you are registered as a charitable institution in Queensland, you may be eligible to claim an exemption from transfer duty when you acquire dutiable property. The exemption also applies to trust transactions such as trust creations, terminations, acquisitions and surrenders.
The exemption will only apply if the property is:
used solely or mainly for a qualifying exempt purpose (i.e. the core purpose of the institution) or
used for fundraising activities (e.g. rent derived from a property) that are carried out for a qualifying exempt purpose.
A qualifying exempt purpose includes:
religious or educational activities (including kindergartens)
care for the sick, aged, infirm, afflicted or incorrigible persons
relief of poverty
full-time care for children by protecting their wellbeing and giving them food, clothing and shelter
another charitable or public benevolent purpose
providing a residence to a minister or members of a religious order conducting a previously listed activity.
Property used for an employment or salary package of an officer or employee of a charitable institution is not exempt from duty.
To claim the exemption, you need to provide us with:
an identity details annexure for each non-Australian transferor and transferee, when transferring real property (e.g. homes, apartments, business premises and vacant land)
a written statement indicating that the charitable institution will:
start to use the property for a qualifying exempt purpose within 6 months of the liability for transfer duty (e.g. settlement). A later start date may be requested at the time of lodgement but reasons for the delay and an estimated start date should be provided
use the property (or the funds from the property) solely or mainly for a qualifying exempt purpose for at least 1 year
not use the property for an employment or salary package of an officer or employee
a written statement detailing how the property will be used.
Registered self assessors cannot self-assess this exemption. However, they can assess the documents if settlement is imminent, then apply for a reassessment within the specified timeframe.
These examples demonstrate when the exemption applies.
ABC Charity purchased a property to be used as disability accommodation. Its legal adviser lodged the documents including a statement detailing how ABC will use the property within 6 months for a period of 1 year.
The exemption applies to this transaction.
ABC Charity purchased a property to be used as disability accommodation, and is waiting on building approval that will take more than 6 months to finalise.
It will rent the property for 12 months from settlement date and use the money for a charitable purpose.
The exemption applies because the rental will be used for a charitable purpose for the specified timeframe.
ABC Charity purchased a property to be used as disability accommodation
It is waiting onbuilding approval that will take more than 6 months to finalise, and decides not to rent the property during this time.
ABC applies for a later start date for use of the property for charitable purposes when it lodges its documents for the exemption.
If the reasons for the later start date are approved, the exemption will apply.
ABC Charity purchased a property to be used as disability accommodation.The settlement was brought forward by 2 weeks and it needs to settle early.
Its legal adviser self-assesses the contract and transfer, and pays the duty.
ABC has 20 months from the settlement date to lodge a reassessment under section 17 of the Taxation Administration Act.
ABC Charity purchased a property to be used as disability accommodation, and is waiting on building approval that will take more than 6 months to finalise.
The settlement was brought forward by 2 weeks and it needs to settle early. Its legal adviser self-assesses the contract and transfer, and pays the duty.
ABC has 20 months from the settlement date to lodge a reassessment and apply for a later start date under s.17 of the Taxation Administration Act.
ABC Charity purchased a property, but is not sure if it will use the property for a charitable purpose. Duty has been paid on the transaction.
In time, ABC decides to use the property for a qualifying exempt purpose.
The Commissioner of State Revenue would consider a reassessment under section 418 of the Duties Act as long as the property has been used for a qualifying exempt purpose for 1 year.
To claim the exemption, ABC would have to lodge a request for reassessment within 5 years from the date of the original assessment (s.18 of the Taxation Administration Act).
