Home Concession – QLD – Rent Free Definition

Legolas on 11/02/2023 - 09:47
Last edited 11/02/2023 - 11:22 by 1 other user

Hi this is related to my first post in regard to stamp duty – Home Concession- QLD

This time the question is the definition of "Rent Free" – I have to make the rent free for tenant to qualify for Stamp Duty Home Concession.

I purchased the unit just 6 months ago and paid QLD stamp duty with Home Concession rate, which saves $6000 plus.

To be qualified home concession of the amount,
- The tenant has to move out within 6months
- Owner needs to move in within 12 month (no issue)
- Owner stop receiving rental money within 6 months (Or you will be asked to pay $6000 plus) <== Rent Free

As my Notice to Leave was delayed due to my misunderstanding, the tenant will stay 2 weeks over 6 months. (I sent the Notice to Leave not before 60days as I was misunderstanding that it was 30 days.)

Currently solicitor is writing letter to Queensland Revenue Office if I only pay percentage of $6000, which she thinks possibly a few hundred dollars charge instead of $6000, for the 2 weeks.

Now I have to stop receiving rent from tenant in a few days before the 6 months date.

Since the due date is next Tuesday and the solicitor is off on weekend please allow me to ask on this site, even lucky if she answers to my question on Monday.

I am using the agency to correct rent money from the tenant, so I requested agency to make rent free next two weeks then the agency has advised me they need to end the contract with me and hand over the management to me. That is yesterday.

Would it be no issue if, after I end the contract with the agency then advise the tenant rent free next two weeks when is until the lease contact end. The tenant still has to vacant the unit by the end of contract which is the 14th date from the date as on Leave Notice.

Or if I keep using the rent correct agency (real estate agency) and receive rent fee next 2 seeks and refund the two weeks rent to tenant with written note. *Because it would be easier for me if the agency take care of bond return etc when the lease contract is end with the tenant

Rules
If your tenant is on a fixed lease and that is ending within 6 months of settlement, you can issue a Notice To Leave (Form 12)^ and move in once they leave. In order to claim the Home Concession rate of stamp duty, you must stop receiving rental monies with 6 months of settlement, you must move in within 12 months of settlement and stay in the property as your principal place of residence for 12 consecutive months. You also cannot commence a new lease with the tenant if wishing to qualify for the Home Concession stamp duty rate.
If your tenant is on a fixed lease that ends more than 6 months after settlement, or if you want to keep them in longer than 6 months after settlement, you may not be able to claim Home Concession and will have to pay with full rate of stamp duty, unless you can negotiate with the tenant to end their lease within the 6 months after settlement. If they are agreeable, then in order to claim the Home Concession rate of stamp duty, you must stop receiving rental monies with 6 months of settlement, you must move in within 12 months of settlement and stay in the property as your principal place of residence for 12 consecutive months.

• 

  AndyC1 on 11/02/2023 - 12:06

  +2

  You should be asking your solicitor as he/she is dealing with it.

• 

  TheRealCher on 11/02/2023 - 12:28

  Ms paint please

• 

  Pelicannn on 11/02/2023 - 12:56

  +2

  I had similar happen to me. Originally intended to live in the house for the 12 months, but due work I got posted away early. Ended up renting it out at about the 10 month mark and kinda just forgot about the home concession thing.

  I only gad to pay a pro-rata of the concession not the full amount, but the amount that the pro-rata still worked out to be almost exactly the amount received for two months rent. In hindsight if I had remembered, I’d have just given the tenant two months free rent rather than give the money to the QLD government lol.

  • 

    Legolas on 11/02/2023 - 21:52

    Thanks.
    Were you contacted by QLD Revenue Office when you still have the tenant after 6 months and asked to pay pro-rata of the concession?
    When I rang them, I was advised to pay full amount regardless of the period after the 6 months.
    Which timing did you give free rent to the tenant, or did you once receive rent from the tenant and refund the amount to them?

    • 

      Pelicannn on 11/02/2023 - 22:03

      +1

      I contacted them. I’m pretty sure because I contacted them that’s why it wasn’t the full amount. Something about an honesty thing. Here’s what the email said:

      Thank you for lodging the Notice for Reassessment (Form D2.4), with our office on 10th July 2022 in relation to the above matter. Please find attached the Reassessment Notice and Exit letter for your attention. Based on the information provided, we have reassessed the Home concession eligibility under s.153 of the Duties Act 2001 (Duties Act) – disposal of the property after occupation and within 1 year of the possession date. Section 153 of the Duties Act provides for partial removal of the concession where a person who claims a concession on a property, moves into the property but disposes of the property by leasing it within 1 year of the possession date.

      Penalty tax is automatically applied at 75% of the primary tax liability, however, as a voluntary disclosure of the change in circumstances was made prior to an investigation, we have remitted penalty tax in full. Unpaid Tax Interest (UTI) for the period of occupancy and from the lodgement date of the QRO Form D2.4 to today’s reassessment has been remitted. UTI will continue from tomorrow’s date until paid in full, the daily rate is provided in the table on page 3 of the notice.

      • 

        Legolas on 12/02/2023 - 19:34

        Thanks so much sharing your experience. So you received 4 months rent fee from tenant after 6th month (10mth - 6mth), and QRO charged the almost equal amount for two months penalty tax.

        Did you just submit Notice for Reassessment (Form D2.4) prepared by yourself at 10th month, is that all?

        Now I incline to keep the contract with the rental collection agency for the last two weeks.

        • 

          Pelicannn on 12/02/2023 - 20:06

          @Legolas: Yes basically. The amount of money received from rent was almost the same as the bill. I submitted D2.4 by myself but can't remember when.

          • 

            Legolas on 13/02/2023 - 00:39

            @Pelicannn: Thanks. I see. I am using solicitor paying $660-$880 ($880 when successful).
            I just could have submitted D2.4 by myself then, but was not confident.