No lease duty in Queensland from 1 January 2006

The long-awaited Revenue Legislation Amendment Bill 2005 (Qld) has been passed by the Queensland parliament, removing the liability for stamp duty on leases that commence on or after 1 January 2006.

The Bill removes the requirement from the Duties Act 2001 (Qld) to pay stamp duty on the rent payable on leases or occupancy rights commencing from 1 January 2006.

Any lease or occupancy right commencing before 1 January 2006 will still attract stamp duty for the full term of the lease or occupancy right.

The obligation to upstamp leases no longer applies on or after 1 January 2006. However, if a liability date for upstamping arises before 1 January 2006, lease duty must be paid.

Previously, the Duties Act had created a liability date for stamp duty at the date of the exercise of an option to renew a lease or occupancy right. The Bill amends the liability date to the commencement of the lease or the occupancy right. Where an option is exercised prior to 1 January 2006, but the commencement date is after 1 January 2006, no stamp duty liability will arise in respect of the new lease or occupancy right.

The Bill also contains provision for the refund of duty paid on leases or occupancy rights arising from an option where the resulting lease or occupancy right commences on or after 1 January 2006.