Swapping Cars with Parents - Any Way to Avoid/Reduce Stamp Duty?

Jatacid on 28/09/2023 - 12:36

My parents are swapping cars with me and I'm trying to figure out how I'm supposed to do this.

They have just moved down from QLD to Sydney. They drove the car over to where I am VIC to visit, and are swapping cars.

They've taken my VIC car back to Syd, and I now have their QLD registered car with me in Melbourne.

What can I do to reduce paying stamp duty on both car title transfers?

What's the best way I need to do this? Deregister both vehicles? Transfer rego into NSW first? Get my parents to register a move into my address in VIC?
Any ideas?

Automotive

Comments

  • pegaxs on 28/09/2023 - 12:42
    +16

    Just do what everyone else does and lie on your transfer from about how much you paid for the vehicle.

    • jv on 28/09/2023 - 12:44
      -8

      It doesn't go by how much you paid for it. They know the value.

      • pegaxs on 28/09/2023 - 12:50
        +7

        No, no they don't. You can put whatever you like on the form, but if it goes off to the state revenue office and they query it, you could be up for the difference plus a fine. The person behind the counter at VicRoads is not going to know nor give a shit.

        Obviously OP can't put $0, but they most certainly can put a value on it at the very low end of the wholesale value of the vehicle.

        • Sinnerator on 29/09/2023 - 08:27
          +1

          can they sell each other the car for $1 and give each other a receipt, they will not be lying as they they genuinely did sell their cars to each other for $1?

          • RMBC on 29/09/2023 - 08:28
            +3

            @Sinnerator: They can, but transfer duty is levied on market value. Ordinarily the value on the transfer form would be considered market value. Obviously in this instance it's a contrivance, so market value substitution rules would apply

      • brendanm on 28/09/2023 - 13:21
        +3

        They don't. I've put down ridiculous values and they've never cared.

    • Jatacid on 28/09/2023 - 12:48

      I actually tell the truth by sale price of 0. But they said the state revenue office will hound me to pay more stamp duty? Is that true?

      • spackbace on 28/09/2023 - 12:49

        What's the redbook value of each car?

        • Jatacid on 28/09/2023 - 12:51

          one is 4k and the other is like 14k.
          But we're swapping it to eachother for free

          • spackbace on 28/09/2023 - 12:56
            +9

            @Jatacid: So say it's $3k - $126 duty
            $12k - $504 duty
            (Vic rates, cbf doing syd rate)

            Weigh up how much the stuffing around of anything else is worth compared to just declaring them a bit cheaper and paying for it

      • pegaxs on 28/09/2023 - 12:54
        +1

        You didn't pay $0 for it. You swapped a car for it. You need put something down.

        Even if it was gifted to you, it still needs a "value" as on the form it will have said something to the affect of "purchase price or market value"

        I don't think there is provisions in the law surrounding stamp duty to be exempt if it is passed from parent to child, only if it is passed from spouse to spouse.

        • iDroid on 28/09/2023 - 19:02
          +2

          No, no, no.. The parents are giving OP their old car that's worth $14k for free, $0 cost.

          A few days later, OP realises he doesn't use his old car now… Hmm what to do with it.. Oh, mum and dad likely need a car since they don't have one now, so OP gives his car to is parents.

          Ahem… yeah?

          • pegaxs on 29/09/2023 - 12:17
            -1

            @iDroid: From the NSW transfer of rego form;

            Sale price or market value (whichever is greater)

            From the Vic transfer of rego form;

            Market value or sale price of the vehicle (Declare the greater of the market value or the sale price. To avoid penalties do not under declare the market value)

            If OP`s parents gave OP the car AND $5,000 cash to take it off them, OP would still have to declare a "market value" for the vehicle. They can't put -$5,000 as the value.

            So, ahem… no.

      • Drakesy on 28/09/2023 - 13:15

        Onus would be on them to prove that you didn't pay for it.
        The evidence that they're literally your parents would be enough to prove it's a gift and even with cost recovery they're not likely to get back whatever resources they invest into it, for what a $400 gain?

        Although you would be getting new plates which means re-registering which means they'll probably check everything with a find toothed comb.

        And there's always the risk that insurance will reference your perceived acquired value of $0.

        • pjetson on 28/09/2023 - 13:55
          +3

          Onus would be on them to prove that you didn't pay for it.

          No, because it's "purchase price or market value". If the purchase price was zero, then it's the markey value that duty has to be paid on.

          • Drakesy on 28/09/2023 - 13:59
            -2

            @pjetson: Could just say i inherited it with a critical problem which you then invested $10's of thousands into it to make it work again.
            But yes, it may fall back to market value depending on state.

            • pjetson on 28/09/2023 - 15:08

              @Drakesy:

              Could just say i inherited it with a critical problem

              If this "critical problem" would reduce the market value of the vehicle (ie what someone at arms length to the transaction would pay for the vehicle), then I think the answer would be yes.

              However, if the transaction was audited, you'd need to be able to back up your claim of the true market value of the vehicle with suitable proof - perhaps a quote from a repairer would do?

            • CrowReally on 28/09/2023 - 15:15
              +1

              @Drakesy:

              Could I just say

              I never quite understood the "solving a lateral thinking brainteaser" approach people have to situations like this where they just invent increasingly unlikely sets of circumstances (that they have absolutely zero paperwork to support).

              Is the theory the guy at the RTA will go "seems fishy but I don't have any proof he's lying so it's time to push the "it's free mate no charge" button"? Do people think that's how things work?

    • Muzeeb on 28/09/2023 - 13:14
      +1

      In Victoria it's about market value not what you paid for the car.

      Market value – also known as dutiable value, is the vehicle purchase price or the price at which a vehicle might reasonably be sold on the open market, whichever is higher.
      For example, you bought a vehicle from your friend/family member for
      $10,000 (purchase price), but if they had instead sold it to someone they didn’t know on the open market they might have been paid $20,000. In this case, the market value is $20,000 not the price you paid.

      OP - you will need to perform a RWC as well (I think)

      Any Way to Avoid/Reduce Stamp Duty?

      Without defrauding the state government - no.

      • billy72 on 28/09/2023 - 16:48
        +1

        you can say the car has a lot of imperfections so the market value is low. They don't care.

    • HeWhoKnows on 29/09/2023 - 11:52
      -1

      Yep, just fudge the value.
      if they question you can just say poor condition or accident damage.
      Coming from another state they will have no past history of the car

  • singlemalt72 on 28/09/2023 - 12:49

    Both vehicles will need to have their plates handed in and re-registered in their new state of residence, his will mean a blue slip for the NSW vehicle and registration/plate/Greenslip fees with Stamp Duty payable (as said, just quote a low proce)

    THe QLD vehicle moving to Vic will need whatever Vic requirements, Hand in plates, RWC then TAC/Rego/Plate/Stamp Duty as well. I think in Vic you can avoid stamp duty transferring to a spouse, unsure about parents.

  • pharkurnell on 28/09/2023 - 13:05
    -1

    I've heard that the amount you put down can affect value of insurance … If you put down $3000 for your $15,000 car - they may value it at $3000

    Not sure if its true or not, I dont wanna find out.

    • ozbjunkie on 29/09/2023 - 21:10

      That last line. Wow what a worldview.

  • RockyRaccoon on 28/09/2023 - 13:33

    You can geta refund on the existing rego, if you return the plates to the state where it was registered. Your parents should be able claim back balance left on rego from QLD and you from Vic.

    Third parties (i guess even related) cant . So you cant claim what they paid and they cant claim what you paid.

  • Typical16-bitEnjoyer on 28/09/2023 - 13:46
    +1

    The best way is for one of the parties to become deceased. No stamp duty. Not recommended in all scenarios tho, including this one.

    • jv on 28/09/2023 - 13:57
      +4

      The best way is for one of the parties to become deceased

      What is the cheapest way to do that?

      • Protractor on 28/09/2023 - 14:54

        Not cheap but reliable>
        Have a head on with a Stinger, while you're driving an Audi. ( So much for their safety claims. )

      • Typical16-bitEnjoyer on 28/09/2023 - 14:58
        +1

        Did a quick number crunch and 'lack of oxygen' came on top.

      • Switchblade88 on 28/09/2023 - 22:49

        Bikies

  • sumyungguy on 28/09/2023 - 14:30
    +1

    For you: transfer the Qld registration to your name using a Qld address. There's a stamp duty exemption where the vehicle is not sold for any amount of money but gifted to a family member. Then proceed according to Vic Roads: Register an interstate vehicle.

    For your parents: sadly no such exemption applies in Vic.

  • Protractor on 28/09/2023 - 14:52

    If your surnames are the same BS them that they put the wrong names per cars.

    • pjetson on 28/09/2023 - 15:11
      +2

      A half-dozen or so years ago, I was able to transfer a vehicle registered in my name to my son (same surname and address) at no cost over the counter at VicRoads. My reason was that when he/we purchased the car, I picked it up and signed the paperwork not realising that the vehicle would then be registered in my name.

      • Protractor on 28/09/2023 - 15:35

        There may be a built it way to have them accept variability like this. OP should have asked before posting,IMO .
        In the end they may have to sign a stat dec (or other form) to say no money changed hands or was made. And voila.

  • hasher22 on 28/09/2023 - 20:46

    It sucks cause you can't "gift" or get a car for free in service NSW eyes….

    just lie and say you got the minimum for it, in your previous comments, I prob but down like 3k

  • Love a bargain on 29/09/2023 - 12:06
    +1

    When it's between family members, wouldn't it be easier to not bother transferring the ownership and just call it as lending the cars to each other?

    • seannami on 01/10/2023 - 09:38

      This- I had my parent's car for many many years cause it was too much to transfer. Then that car got re-registered (free) and I kept the plates ($40 reassignment fee) for my new car. Insurance etc don't care who is the registered owner as long as the main driver is the policy holder, maybe put your parents as the secondary named drivers or something.

      Just be wary whose car is worth more when someone sells ;)

  • SaiWanHo on 29/09/2023 - 12:10

    Pensioners can gift annnually $10000, or bundled up to $30000 for 3 years. That will not affect their pensions. As with the receiver ends, you can claimed it as a gift.

    • Grunta on 26/01/2024 - 14:20
      -1

      Absolutely nothing to do with registration…
      Doesn't work that way

      • kerfuffle on 26/01/2024 - 14:31

        You signed up to Ozbargain to make comments in a thread that last received comments in October?

  • Grunta on 26/01/2024 - 14:14
    -1

    The value of each car -
    Say parents car is worth $10k - kids car is $2k

    This is the transaction you "paid"
    You "give" $2k of goods (car) .. = paid as far as Vic roads is concerned.
    They did the same, ($10k)…. There's no "free" in this scenerio

    • dkwon10 on 27/01/2024 - 01:06

      Yer definitely can't put $0 in value. In QLD it's either the actual price you pay or market value, whichever is higher, and 3% of that price is the money you have to pay. I once put $2k for a 6yo car and the lady at the counter didn't care tho

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