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Changes to stamp duty a win for farming families



Changes to stamp duty a win for farming families

Family-owned farming businesses will now benefit from new laws passed in Parliament last week that will see stamp duty exemptions extended on the transfer of primary production land to a company or other entity directed by a family member.

NSW is home to a diverse range of primary industries, and this move makes it easier for the next generation to follow in their families footsteps, whether it be in beef, dairy, poultry, wool or cropping operations.

Minister for Finance Damien Tudehope said the removal of stamp duty for family-owned companies, trusts or entities would cut costs and help support the next generation of NSW farmers.

"Under the former stamp duty legislation, if someone wanted to pass their farm on to a child's trust or company to operate, there would be stamp duty charged on that transfer. This simply doesn't make sense with the way family businesses operate. This legislation will modernise family farming business practices."

Under former legislation, only a member of the family is exempt from duty tax when buying the land. The State Revenue and Fines Legislation Amendment (Miscellaneous) Bill 2022 extends this exemption to family farms that are structured using a trust or company in addition to those owned by individuals.

The transferee would need to maintain control of the entity for a period of at least three years after purchase to ensure the integrity of the exemption

Minister for Agriculture and Western NSW Dugald Saunders said this is another step forward in encouraging younger generations into farming. "The farming industry has been through a lot in the last few years; drought, bushfires, a global pandemic, a mouse plague and of course floods, so this will be a welcome announcement for food and fibre producers," Mr Saunders said.

If you have any questions regarding the changes to stamp duty legislation, or how this could be of benefit to your farming business, please contact your Forsyths Accountant.