Legal Comment by Mark Illidge of Hinterland Lawyers

September 2007

Good news for some retirement village unit owners/buyers. The Treasurer recently announced that home concessional duty is now allowable in circumstances where a unit in a retirement village is occupied under a lease back arrangement between the resident and the retirement village operator.

The consessional duty is retrospective and will apply to transactions effected on or after 26 July 2002. Anyone who has paid transfer duty on the purchase of a unit in a registered retirement village since 26 July 2002, and who did not receive the home concession, may apply for an ex gratia refund of the excess duty.

A ‘Statutory Declaration (ex gratia)’ must be completed by each purchaser claiming an ex gratia refund. Refund applicants will also need to provide the original stamped documents with their application to verify the duty paid. The average saving on stamp duty is about $4,000.00 but varies according to the purchase price.

This amendment to the stamp duty legislation is long overdue as to-date people have been penalised by being unable to claim the home concession due to arrangements put in place by retirement village operators. These arrangements usually involve the resident’s freehold unit being leased back to the operator who in turn subleases back to the resident. This is a legal procedure which allows the operator to set by-laws on the properties.

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