The Abolishment of the Torrens Assurance Levy

Background

Since 1 July 2010, all transfers of land having a value of more than $500,000 in NSW are subject to an ad valorem or 'according to value' land transfer levy. The levy is payable by the purchaser to the Land and Property Management Authority NSW (LPI)) and is in addition to the nominal lodgment fee charged by the LPI, and stamp duty.

Changes

The Real Property Amendment (Torrens Assurance Levy Repeal) Bill 2011 (NSW) (which was introduced into Parliament on 9 May 2011) will repeal those provisions of the Real Property Act 1900 (NSW), so that there will no longer be an ad valorem levy payable in relation to land transfers from 1 July 2011, As of July 2011 this repeal came into affect. Importantly, the Bill provides that the levy will still apply to transfers executed to give effect to a contract for the sale of land entered into before 1 July 2011 but lodged with the LPMA after 1 July 2011. The LPMA will therefore presumably rely on the contract date recorded on the notice of sale that accompanies the transfer at lodgment   in determining whether the ad valorem levy applies after 1 July 2011.

From July 2011, $4.00 from every dealing lodgment fee will be assigned to the TAF, as was the case prior to July 2010. This will ensure that sufficient funds remain available to make compensation payments from the fund when required.

For Further Information visit The Real Property Amendment (Torrens Assurance Levy Repeal) Act 2011 No. 7 is published on the NSW legislation website www.legislation.nsw.gov.au.