A self assessor is a registered agent of the Office of State Revenue who has authority to endorse documents and collect funds in respect of duty. The Queensland Law Society has reminded self assessors that they "…must not endorse an instrument unless the amount of duty and any assessed interest and penalty tax has been received by the self assessor". 

In most circumstances, the financier will require a stamped Transfer at settlement.  Even if the purchaser is not being financed, we recommended that the Transfer is stamped prior to settlement to facilitate the immediate registration of the Transfer and reduce any risk of a change to the title between settlement and registration. 

HOW DOES THIS AFFECT THE PURCHASER?

In almost all instances, a purchaser will need to have access to funds to cover the duty prior to settlement. The Queensland Law Society has recently advised that a number of law firms seem to have developed a practice of stamping documents prior to settlement and obtaining a cheque for the dutiable amount from the financier at settlement.  This practice appears to have developed as a result of pressure from purchasers usually because of one or more of the following reasons:

1. It is "easier" for the purchaser not to have to arrange for a separate transfer from their account or to make funds available prior to settlement;
2. The financier is providing 100% of the funds for the purchase of the property; or
3. The purchaser intends to pay the Duty out of the First Home Owner's Grant which is received by the financier and only available at settlement.

CONSEQUENCES FOR SELF ASSESSOR'S

Endorsing documents prior to receiving the funds (even if a cheque is received at settlement) is a breach of Section 480(2) of the Duties Act 2001 (Qld) and could render a self assessor liable to monetary penalties, together with the suspension or cancellation of their self assessor's registration.  Further, a law firm may be liable if it refuses to effect settlement because a cheque for duty has not been made available, and subsequently the purchaser is in default under the Contract.

ROLE OF THE AGENT

The agent is often the first point of contact for a prospective purchaser.  To avoid disappointment to a purchaser, an agent should be advising a purchaser that they will need to have access to some funds in order to cover the duty amount. Alternatively if the purchaser's financier is advancing duty as well as the balance purchase price, then a purchaser will need to make arrangements with their financier to pay the duty and be reimbursed at settlement or for the financier to accept an unstamped Transfer.

For further information on this topic, please contact one of our Conveyancing team:

• Laurie Warnick - 3031 9708
• Steven Titmus - 4722 8712
• Matthew Bowen - 4030  0677
• Andrew Douglas - 4722 0214
• Connie Navarro - 4722 0241
• Vicki Kerr - 4030 0611
• Janet Nolan - 4030 0683
• Helen Maher - 4030 0673
• Vicki Lee Long - 4030 0558
• Pam McGowan - 4030 0641
• Melanie Campbell - 4722 8715

Conveyancing Solutions is a newsletter intended only to provide general information about current legal issues and does not constitute, nor should it be used or treated as, professional or legal advice. Readers should make their own enquiries or seek legal advice before making any decisions concerning their own interests.