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DUTIES ACT 1997 - SECT 64C
Transfers made in partial conformity with agreements
64C Transfers made in partial conformity with agreements
(1) The duty chargeable in respect of a transfer of dutiable property is to be
calculated in accordance with this section if-- (a) the transfer is made in
partial conformity with an agreement for transfer or sale of the
dutiable property, and
(b) the duty chargeable in respect of the agreement
has been paid.
(2) A transfer is made in partial conformity with an agreement
for transfer or sale if the transfer conforms with the agreement, apart from
the fact that a share in the dutiable property transferred to one or more of
the transferees under the transfer exceeds the share agreed to be transferred
to the relevant transferee under the agreement.
(3) Duty is to be charged
only on the excess proportion of the dutiable value of the dutiable property
transferred.
(4) The
"excess proportion" is the proportion, or the total of the proportions, by
which the share or shares in the dutiable property transferred to each
transferee exceed the share or shares in the dutiable property (if any) agreed
to be transferred to each transferee.
(5) If a share in dutiable property is
transferred to a transferee who was not a transferee under the agreement for
transfer or sale, this section applies as if the share agreed to be
transferred to that transferee is nil.
(6) This section does not apply if
section 18 (3) applies in respect of the transfer.
Example 1: An agreement
provides for the transfer of dutiable property to 3 purchasers as equal
tenants in common. Accordingly, the share of the dutiable property agreed to
be transferred to each purchaser is one-third each. When the property is
transferred, it is transferred to only 2 of the purchasers so that each
purchaser acquires a one-half share. The shares transferred exceed the shares
agreed to be transferred. That is, each purchaser has acquired a one-half
share in the property instead of a one-third share. The excess proportion is
the total of the proportions by which the shares transferred to the
transferees exceed the shares agreed to be transferred. The total of (one-half
minus one-third) and (one-half minus one-third) is one-third. Duty is charged
on one-third of the dutiable value of the property transferred.
Example 2: An agreement provides for the transfer of dutiable property to 2
purchasers as equal tenants in common. Accordingly, the share of the
dutiable property agreed to be transferred to each purchaser is one-half each.
When the property is transferred, it is transferred to 3 transferees so that
each transferee acquires a one-third share. The 2 one-third shares transferred
to the original purchasers under the agreement do not exceed the shares agreed
to be transferred. The excess proportion is the proportion by which the share
transferred to the new transferee (one-third) exceeds the share agreed to be
transferred (nil). Duty is charged on one-third of the dutiable value of the
property transferred.
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