Used to evidence transfer of property between financial institutions when there is no transfer document.
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All building societies, credit unions and friendly societies became Authorised Deposit-Taking Institutions (ADIs) within the meaning of the Banking Act 1959 on 1 July 1999. From this date, they also became companies for the purposes of the Corporations Law, with the Financial Institutions (Victoria) Code (the Code) ceasing to apply to them.
As a result of these changes, the supervision of ADIs was transferred to the Commonwealth via the Financial Sector (Transfers of Business) Act 1999 (the FS(TB) Act). Under section 22 of that Act, where there is a transfer of business from one ADI to another all assets and liabilities of the transferring body become the assets and liabilities of the receiving body without any transfer, conveyance or assignment of property.
The voluntary transfers of assets as a result of the merger of a financial institution may, however, be eligible for an exemption under the Duties Act 2000 (Duties Act) where the merger meets the criteria established under these guidelines, which have been approved by the Treasurer of Victoria.
It has been necessary to reissue these guidelines as a result of the introduction of the Duties Act, effective on 1 July 2001. The previous guidelines were issued under section 137P of the Stamps Act 1958 (Stamps Act).
A ‘receiving body’ is one to whom any property is transferred under Part 3 of the FS(TB) Act. A receiving body that receives any such property must:
- Lodge a statement with the Commissioner if duty would have been chargeable had an instrument for the conveyance, transferor assignment of the property been executed in relation to the transfer.
- Lodge a statement in a form approved by the Commissioner and specify the property transferred and the value of that property.
- Pay duty on the statement unless it is not chargeable under these guidelines.
Substantial penalties apply under sections 57 and 59 of the Taxation Administration Act 1997 for failing to lodge a statement as required, and for lodging a statement that is knowingly false and misleading. Statements that do not qualify for an exemption under section 109 of the Duties Act are liable to duty, which must be paid within three months after the day on which the property became the property of the receiving body.
Exemption from duty
Section 109 of the Duties Act provides an exemption from Victorian duty for dutiable instruments arising from the voluntary transfers of assets of a financial institution. Institutions seeking an exemption from duty must apply in writing to the State Revenue Office of Victoria. The application must specify the property that is the subject of the instrument(s) of transfer, the amount of any duty involved, and explain why the proposal meets these guidelines.
An exemption is available where:
- A certificate of transfer is issued by the Australian Prudential Regulation Authority (APRA) under section 18 of the FS(TB)Act.
- The merger or transfer of engagements would not previously have been liable to duty under the Stamps Act by virtue of the operation of the former Financial Institutions (Victoria) Code.