State Taxation and Other Acts Amendment Act 2012

No. 76 of 2012

TABLE OF PROVISIONSSection Page

PART 1—PRELIMINARY 1

1 Purpose 12 Commencement 3

PART 2—LAND TAX ACT 2005 4

3 Definitions—Section 3 44 Definitions—Section 52 45 Principal place of residence exemption 46 Deferral of tax on certain residential land for 6 months 57 New section 55A inserted 5

55A Deferral of tax for residential land to be used during tax year 5

8 Absence from principal place of residence 69 Exemption continues if land becomes unfit for occupation 910 Purchase of new principal residence 911 Sale of old principal residence 1112 Unoccupied land subsequently used as principal residence 1313 Partial exemption if land used for business activities 1414 New section 62A inserted 14

62A Partial exemption if separate residence is leased for residential purposes 14

15 Section 63 substituted 1563 Partial exemption or refund for trustees 15

16 Recovery from lessee, mortgagee or occupier 1617 Land held on trust 1618 Transitional provision 17

14 State Taxation and Other Acts Amendment Act 2012 17

PART 3—ROAD SAFETY ACT 1986 18

19 Definitions 1820 Effecting registration, renewal or transfer 18

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PART 4—TAXATION ADMINISTRATION ACT 1997 19

21 Permitted disclosures to particular persons 1922 Objections concerning the value of property 1923 Suspension of determination 2024 Transitional provision 21

PART 5—TRUSTEE COMPANIES ACT 1984 22

25 New Division headings inserted in Part V 2226 New section 26AA inserted 22

26AA Definitions 2227 Transfer determinations 2328 Consequential amendment of State Trustees (State Owned

Company) Act 1994 23

PART 6—REPEAL 24

29 Repeal of amending Act 24═══════════════

ENDNOTES 25

State Taxation and Other Acts Amendment Act 2012†

No. 76 of 2012

[Assented to 4 December 2012]

The Parliament of Victoria enacts:

PART 1—PRELIMINARY

1 Purpose

The purpose of this Act is—

(a) to amend the Land Tax Act 2005—

(i) to modify the requirements for the principal place of residence exemption; and

Victoria

1

(ii) to restrict the amount of unpaid tax the Commissioner can recover from a lessee or occupier of land; and

(iii) to make other minor amendments in relation to trusts;

(b) to amend the Road Safety Act 1986 to set out the base registration fee for vehicle registration in that Act;

(c) to amend the Taxation Administration Act 1997—

(i) to permit the disclosure of taxation information to the Registrar of Titles; and

(ii) to give the Commissioner a discretion to refer a matter for valuation if an objection relates to the valuation of property; and

(iii) to require an objector to pay the cost of a valuation where the objector has not provided information about the value of property to the Commissioner; and

(iv) to change the time from which the Commissioner may suspend the determination of an objection;

(d) to amend the Trustee Companies Act 1984 to provide for the transfer of estate assets and liabilities on all compulsory and voluntary transfer determinations made under the Corporations Act in respect of trustee companies registered in Victoria and to make a consequential amendment to the State Trustees (State Owned Company) Act 1994.

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s. 1

2 Commencement

(1) This Act (except Part 3) comes into operation on the day after the day on which it receives the Royal Assent.

(2) Subject to subsection (3), Part 3 comes into operation on a day to be proclaimed.

(3) If Part 3 does not come into operation before 30 March 2013, it comes into operation on that day.

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s. 2

PART 2—LAND TAX ACT 2005

3 Definitions—Section 3

In section 3(1) of the Land Tax Act 2005, in the definition of discretionary trust omit ", a fixed trust or a trust to which a unit trust scheme relates".

4 Definitions—Section 52

In section 52(1) of the Land Tax Act 2005 insert the following definitions—

"separate residence means a building affixed to land that is capable of separate occupation as a residence;

vested beneficiary, in relation to land held on trust, means a beneficiary of the trust who—

(a) is a natural person; and

(b) has a vested beneficial interest in possession in the land.".

5 Principal place of residence exemption

(1) In section 54(1)(b) of the Land Tax Act 2005, for "natural person who is a beneficiary of the trust" substitute "vested beneficiary in relation to the land".

(2) In section 54(1A)(b)(i) and (ii) of the Land Tax Act 2005, for "Part" substitute "Division".

(3) In section 54(2) of the Land Tax Act 2005, for "beneficiary", substitute "vested beneficiary".

See:Act No.88/2005.Reprint No. 4as at13 October 2011and amendingAct Nos49/2010, 35/2011 and 69/2011.LawToday:www.legislation.vic.gov.au

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(4) In section 54(3) of the Land Tax Act 2005—

(a) in paragraph (c)(ii), for "that year." substitute "that year; and";

(b) after paragraph (c) insert—

"(d) does not contain a separate residence.".

6 Deferral of tax on certain residential land for 6 months

In section 55(1)(b) of the Land Tax Act 2005, for "beneficiary" substitute "vested beneficiary in relation to the land".

7 New section 55A inserted

After section 55 of the Land Tax Act 2005 insert—

"55A Deferral of tax for residential land to be used during tax year

(1) The Commissioner may determine that land tax in respect of land for a year is not payable until the expiry of a 6 month period that begins and ends in that year if—

(a) a person becomes the owner of the land on or after 1 July in the preceding year; and

(b) as at 31 December in the preceding year, the person does not use or occupy the land as his or her principal place of residence; and

(c) the Commissioner is satisfied that the person intends to continuously use and occupy the land as his or her principal place of residence for the 6 month period.

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(2) The Commissioner may determine that land tax in respect of land for a year is not payable until the expiry of a 6 month period that begins and ends in that year if—

(a) a trustee becomes the owner of the land on or after 1 July in the preceding year; and

(b) as at 31 December in the preceding year, there is no vested beneficiary in relation to that land using and occupying it as his or her principal place of residence; and

(c) the Commissioner is satisfied that a vested beneficiary in relation to that land intends to continuously use and occupy it as his or her principal place of residence for the 6 month period.

(3) If land referred to in subsection (1) or (2) that would have been exempt land in respect of a year but for section 54(2) has been continuously used and occupied as the person's principal place of residence for the period of 6 months, the land becomes exempt land in respect of that year at the end of that period.".

8 Absence from principal place of residence

(1) In the heading to section 56 of the Land Tax Act 2005, for "Temporary absence" substitute "Absence".

(2) For section 56(1)(c) and (d) of the Land Tax Act 2005 substitute—

"(c) that, in respect of the period of absence, no other land is exempt land under this Division or under a law of another jurisdiction (whether in or outside Australia) as the

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principal place of residence of the owner or, in the case of a trustee, as the principal place of residence of a vested beneficiary in relation to the land.".

(3) After section 56(1) of the Land Tax Act 2005 insert—

"(1A) For the purposes of this Division, land is taken to be used and occupied as the principal place of residence of a person despite the person's absence from the land if—

(a) the person has lost the ability to live independently; and

(b) the person resides—

(i) at a hospital as a patient of the hospital; or

(ii) at a residential care facility or supported residential service within the meaning of section 76(4), or a residential service within the meaning of the Disability Act 2006, and receives residential or respite care at the facility or service; or

(iii) with another person who provides personal support to the person on a daily basis.".

(4) In section 56(2) of the Land Tax Act 2005, after "subsection (1)" insert "or (1A)".

(5) For section 56(3) of the Land Tax Act 2005 substitute—

"(3) Land will not be taken to be used and occupied as the principal place of residence of a person under this section unless the

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conditions set out in subsections (4) and (5) are both satisfied.

(4) The condition in this subsection is that the land—

(a) was exempt land under section 54 immediately before the person's absence; or

(b) was used and occupied—

(i) in the case of an owner—by the owner as his or her principal place of residence for a period of at least 6 consecutive months immediately before the owner's absence; or

(ii) in the case of a trustee—by a vested beneficiary in relation to the land as his or her principal place of residence for a period of at least 6 consecutive months immediately before the vested beneficiary's absence.

(5) The condition in this subsection is that the owner or trustee has not rented out the land for a period which is 6 months or more, or for periods which total 6 months or more, in the year preceding the tax year.

(6) The maximum period for which land can be taken to be used and occupied as the principal place of residence of a person despite the person's absence from the land under this section is 6 years from the date of the person's absence.Note

If a person has been absent for more than 6 years and land ceases to be taken to be used and occupied as the principal place of residence of the person, the land

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will no longer be exempt land under this Division unless another exemption applies.

(7) In this section—

personal support means the provision of one or more of the following—

(a) assistance with personal hygiene, toileting or dressing;

(b) assistance to achieve and maintain mobility;

(c) support to seek out and maintain contact with health professionals, social networks, family, friends and the community;

(d) emotional wellbeing support;

(e) assistance with or supervision in administering medication;

(f) assistance with eating and maintaining adequate nutrition.".

9 Exemption continues if land becomes unfit for occupation

In section 58(4) of the Land Tax Act 2005, for "beneficiary" substitute "vested beneficiary in relation to the land".

10 Purchase of new principal residence

(1) For section 59(1) and (2) of the Land Tax Act 2005 substitute—

"(1) Land is exempt land in respect of a year if—

(a) a person becomes the owner of the land in the preceding year for use and occupation as his or her principal place of residence; and

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(b) as at 31 December in the preceding year, the person is the owner of other land that he or she uses and occupies as his or her principal place of residence.

Note

In this situation, the land referred to in paragraph (b) will be exempt land in the circumstances set out in section 54(1)(a).

(2) Land is exempt land in respect of a year if—

(a) a trustee becomes the owner of the land in the preceding year for use and occupation of a vested beneficiary in relation to the land as his or her principal place of residence; and

(b) as at 31 December in the preceding year, the trustee is the owner of other land that the vested beneficiary uses and occupies as his or her principal place of residence.

Note

In this situation, the land referred to in paragraph (b) will be exempt land in the circumstances set out in section 54(1)(b).".

(2) In section 59(3) of the Land Tax Act 2005, for "An exemption under subsection (1) or (2) is revoked if the owner or beneficiary" substitute "The Commissioner may revoke an exemption under subsection (1) or (2) if the owner or vested beneficiary in relation to the land".

(3) For section 59(4) of the Land Tax Act 2005 substitute—

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"(4) Subsection (1) does not apply to land in respect of a year if the owner derived any income from the land at any time when it was not occupied as the principal place of residence of the owner.

(5) Subsection (2) does not apply to land in respect of a year if the trustee derived any income from the land at any time when it was not occupied as the principal place of residence of a vested beneficiary in relation to the land.".

11 Sale of old principal residence

(1) For section 60(1) and (2) of the Land Tax Act 2005 substitute—

"(1) Land owned by a person is exempt land in respect of a year if—

(a) either—

(i) the land was exempt land under section 54(1) for the preceding year; or

(ii) the person used and occupied the land as his or her principal place of residence for a period of at least 6 months during the preceding year; and

(b) as at 31 December in the preceding year, the person was the owner of other land that he or she used and occupied as his or her principal place of residence.

Note

In this situation, the land referred to in paragraph (b) will be exempt land in the circumstances set out in section 54(1)(a).

(2) Land owned by a trustee is exempt land in respect of a year if—

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(a) either—

(i) the land was exempt land under section 54(1) for the preceding year; or

(ii) a vested beneficiary in relation to the land used and occupied it as his or her principal place of residence for a period of at least 6 months during the preceding year; and

(b) as at 31 December in the preceding year, the trustee was the owner of other land that a vested beneficiary referred to in paragraph (a) used and occupied as his or her principal place of residence.

Note

In this situation, the land referred to in paragraph (b) will be exempt land in the circumstances set out in section 54(1)(b).".

(2) In section 60(3) of the Land Tax Act 2005, for "An exemption under subsection (1) or (2) is revoked if the owner or trustee" substitute "The Commissioner may revoke an exemption under subsection (1) or (2) if the owner or trustee".

(3) For section 60(4) of the Land Tax Act 2005 substitute—

"(4) Subsection (1) does not apply to land in respect of a year if the owner derived income from the land at any time when it was not occupied as the principal place of residence of the owner.

(5) Subsection (2) does not apply to land in respect of a year if the trustee derived any income from the land at any time when it

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was not occupied as the principal place of residence of a vested beneficiary in relation to the land.".

12 Unoccupied land subsequently used as principal residence

(1) For section 61(1)(a) of the Land Tax Act 2005 substitute—

"(a) the owner was unable to occupy that land as his or her principal place of residence as at 31 December in the preceding year because a residence was being constructed or renovated on it; and

(ab) once construction or renovation of that residence has been completed, the owner continuously uses and occupies the land as his or her principal place of residence for at least 6 months commencing in that year; and".

(2) For section 61(2) of the Land Tax Act 2005 substitute—

"(2) A trustee who was assessed for and paid land tax in respect of a year in respect of land that is not occupied as the principal place of residence of a vested beneficiary in relation to the land is entitled to a refund of that land tax if—

(a) the vested beneficiary was unable to occupy the land as his or her principal place of residence as at 31 December the preceding year because a residence was being constructed or renovated on it; and

(b) once construction or renovation of that residence has been completed, the vested beneficiary continuously uses

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and occupies the land as his or her principal place of residence for at least 6 months commencing in that year; and

(c) an application for a refund is made before the end of the next following year.".

(3) The note at the foot of section 61(4) of the Land Tax Act 2005 is repealed.

(4) In section 61(5) of the Land Tax Act 2005, for "beneficiary under the trust" substitute "vested beneficiary in relation to land".

13 Partial exemption if land used for business activities

(1) In section 62(1) of the Land Tax Act 2005—

(a) for "this Part" substitute "this Division";

(b) after "residential purposes" insert "by the owner, a vested beneficiary in relation to the land or a natural person who has a right to reside on the land (as the case requires)".

(2) For section 62(2)(e) of the Land Tax Act 2005 substitute—

"(e) any other matters the Commissioner considers relevant.".

14 New section 62A inserted

After section 62 of the Land Tax Act 2005 insert—

"62A Partial exemption if separate residence is leased for residential purposes

If land that would be exempt under this Division contains a separate residence that is leased for residential purposes—

(a) land tax is assessable on the part of the land that is leased for residential purposes; and

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(b) section 22 applies, if necessary, for that purpose.".

15 Section 63 substituted

For section 63 of the Land Tax Act 2005 substitute—

"63 Partial exemption or refund for trustees

(1) This section applies if—

(a) a trustee would be entitled to an exemption from or refund of land tax under this Division in respect of land because a vested beneficiary in relation to the land has used and occupied it as his or her principal place of residence; and

(b) there are other vested beneficiaries in relation to the land who have not used and occupied it as their principal place of residence.

(2) Despite anything to the contrary in this Division, the amount of the exemption or refund is determined as if the value of the land were the proportion of the value of the land that is equal to the proportion that the interest in the land held by the vested beneficiary in relation to the land referred to in subsection (1)(a) bears to the total interests of all vested beneficiaries in relation to that land.

(3) Nothing in this section applies in the case of a person entitled to a life estate in possession.".

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16 Recovery from lessee, mortgagee or occupier

(1) After section 98(1) of the Land Tax Act 2005 insert—

"(1A) The Commissioner cannot require a lessee or occupier—

(a) to pay an amount of land tax under this section that is greater than the amount of rent the lessee or occupier is required to pay the taxpayer; or

(b) to pay an amount of land tax under this section before the day on which the lessee or occupier is required to pay rent to the taxpayer.

(1B) Subsection (1A) does not apply to a lessee or occupier that is a related corporation or relative of the taxpayer.".

(2) After section 98(6) of the Land Tax Act 2005 insert—

"(6A) If a lessee or occupier pays an amount of tax under this section—

(a) the amount is deemed to have been paid to the Commissioner by the taxpayer; and

(b) the lessee or occupier is deemed to have paid an equal amount of rent to the taxpayer under the lease or agreement or under any applicable tenancy law.".

17 Land held on trust

In sections 46B(4)(a) and 46D(1)(a) of the Land Tax Act 2005, after "deemed" insert ", for the

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purposes of this Act other than Division 1 of Part 4,".

18 Transitional provision

After clause 13 of Schedule 3 to the Land Tax Act 2005 insert—

"14 State Taxation and Other Acts Amendment Act 2012

(1) Section 61, as in force immediately before the commencement day, continues to apply in relation to land tax paid in respect of the 2012 tax year.

(2) Section 98, as amended by section 16 of the State Taxation and Other Acts Amendment Act 2012, applies on and after the commencement day irrespective of whether the lease or other arrangement under which the lessee or occupier occupies the land was entered into or made before, on or after that day.

(3) In this clause—

commencement day means the day on which Part 2 of the State Taxation and Other Acts Amendment Act 2012 comes into operation.".

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PART 3—ROAD SAFETY ACT 1986

19 Definitions

Insert the following definition in section 3(1) of the Road Safety Act 1986—

"base registration fee means the fee specified in section 9(2);".

20 Effecting registration, renewal or transfer

After section 9(1A) of the Road Safety Act 1986 insert—

"(2) Subject to the regulations, the fee payable for registration or renewal of registration of a motor vehicle or trailer is 18·54 fee units.

(3) The regulations may provide that a fee other than the base registration fee, or that no fee, is payable for registration or renewal of registration of any category of motor vehicle or trailer.".

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See:Act No.127/1986.Reprint No. 14as at27 April 2012and amendingAct Nos19/1991, 32/2011, 34/2011, 65/2011, 21/2012, 43/2012, 45/2012, 50/2012 and 52/2012.LawToday:www.legislation.vic.gov.au

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PART 4—TAXATION ADMINISTRATION ACT 1997

21 Permitted disclosures to particular persons

After section 92(1)(e)(va) of the Taxation Administration Act 1997 insert—

"(vab) the Registrar of Titles; or".

22 Objections concerning the value of property

(1) Insert the following heading to section 100A of the Taxation Administration Act 1997—

"Objections concerning the value of property".

(2) In section 100A(1) of the Taxation Administration Act 1997, for "must" substitute "may".

(3) For section 100A(2) of the Taxation Administration Act 1997 substitute—

"(2) The objector must pay the cost of a valuation under subsection (1) if, at the time the objection was lodged—

(a) the objector had not provided any information to the Commissioner as to the value of the property; or

(b) the objector—

(i) had provided information to the Commissioner as to the value of the property; and

(ii) the valuation under subsection (1) exceeds the value provided by the objector by 15% or more; and

See:Act No.40/1997.Reprint No. 5as at13 October 2011and amendingAct No.69/2011.LawToday:www.legislation.vic.gov.au

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(iii) the valuation as determined on the objection, or on appeal or review, exceeds the value provided by the objector by 15% or more.".

23 Suspension of determination

For section 102(1) and (2) of the Taxation Administration Act 1997 substitute—

"(1) The Commissioner may suspend the determination of an objection, by written notice given to the objector, if—

(a) under a taxation law the Commissioner has required or requested a person to provide the Commissioner with information relevant to the objection; or

(b) the Commissioner has referred the matter to the Valuer-General or another competent valuer under section 100A for valuation.

(2) A suspension under this section—

(a) takes effect on service of the notice under subsection (1); and

(b) remains in effect until—

(i) in the case of subsection (1)(a), the objector, or another person, provides the information that the Commissioner has required or requested; or

(ii) in the case of subsection (1)(b), the Commissioner receives the valuation.".

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24 Transitional provision

After clause 13(11) of Schedule 1 to the Taxation Administration Act 1997 insert—

"(12) Sections 100A and 102, as in force immediately before the commencement of Part 4 of the State Taxation and Other Acts Amendment Act 2012, continue to apply on and after that commencement in relation to an objection lodged under section 96 before that commencement.".

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PART 5—TRUSTEE COMPANIES ACT 1984

25 New Division headings inserted in Part VSee:Act No.10168.Reprint No. 5as at21 May 2009and amendingAct Nos68/2009 and 17/2010.LawToday:www.legislation.vic.gov.aus. 25

In the Trustee Companies Act 1984—

(a) after the heading to Part V insert—

"Division 1—General".

(b) after section 26 insert—

"Division 2—Transfer of estate assets and liabilities".

26 New section 26AA inserted

Before section 26A of the Trustee Companies Act 1984 insert—

"26AA Definitions

(1) Terms used in this Division and in Part 5D.6 of the Corporations Act have the same meanings in this Division as they have in that Part.

(2) For the of avoidance of doubt—

(a) a reference in Part 5D.6 of the Corporations Act to the Public Trustee of a State or Territory is taken to be, in

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relation to Victoria, a reference to State Trustees; and

(b) a reference in this Division to a receiving company includes a reference to State Trustees.".

27 Transfer determinations

(1) For the heading to section 26A of the Trustee Companies Act 1984 substitute—

"Transfer determinations under the Corporations Act".

(2) For section 26A(1)(a) of the Trustee Companies Act 1984 substitute—

"(a) the Australian Securities and Investments Commission (ASIC) makes a determination under section 601WBA(1) of the Corporations Act that there is to be a transfer of estate assets and liabilities from a transferring company to a receiving company; and".

28 Consequential amendment of State Trustees (State Owned Company) Act 1994

At the end of section 20A of the State Trustees (State Owned Company) Act 1994 insert—

"(2) Despite subsection (1), sections 26AA, 26A and 26B of the Trustee Companies Act 1984 apply in respect of State Trustees.".

s. 27

See:Act No.45/1994.Reprint No. 2as at15 May 2008and amendingAct No.17/2010.LawToday:www.legislation.vic.gov.au

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PART 6—REPEAL

29 Repeal of amending Act

This Act is repealed on 30 March 2014.Note

The repeal of this Act does not affect the continuing operation of the amendments made by it (see section 15(1) of the Interpretation of Legislation Act 1984).

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ENDNOTES

Endnotes

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† Minister's second reading speech—

Legislative Assembly: 24 October 2012

Legislative Council: 15 November 2012

The long title for the Bill for this Act was "A Bill for an Act to amend the Land Tax Act 2005, the Road Safety Act 1986, the Taxation Administration Act 1997, the Trustee Companies Act 1984 and for other purposes."