The Stamp Duty Amendment Bill 2023 (‘the Bill’) abolishes stamp duty on all non-land interests (except for chattels conveyed with an interest in land), eliminating the tax on the conveyance of business assets such as goodwill, the right to use a business name, intellectual property and on certain statutory licenses. Additionally, stamp duty in the Northern Territory is no longer payable on chattels when transferred with a lease of land that has ‘nil or only nominal dutiable value’ and is not conveyed with any other dutiable property, nor on the conveyance of rights under franchise agreements. However, stamp duty will still be payable on the conveyance of land and buildings, motor vehicles and mining and petroleum interests.
The provisions only apply to conveyances of non-land assets pursuant to an agreement, option or instrument of conveyance executed on or after 9 May 2023.
Stamp duty will still be payable on a conveyance of a non-land assets pursuant to an agreement, option or instrument of conveyance executed before 9 May 2023, with anti-avoidance provisions inserted to prevent persons seeking to take advantage of the stamp duty abolition by terminating existing agreements and entering into new agreements after 9 May 2023.
Stamp duty is a significant transactional cost that can often be an important consideration in the negotiation for the sale and purchase of businesses and other assets. By abolishing stamp duty on business sales, including franchises, and the conveyance of other statutory licenses, this removes a cost that can often be an impediment to these transactions taking place and brings the Northern Territory stamp duty provisions in line with those of other states and territories, such as NSW, VIC, ACT, SA and TAS, all of who have previously abolished duty on business sales.
To discuss the recent announcement in greater detail, or how we can assist you in the sale or purchase of a business, please contact us on the details provided below.