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The stamp duty payable in a conveyancing transaction is usually paid by the purchaser. Where the transaction involves a residential property, the ad valorem stamp duty will normally be paid upon the purchaser signing the formal agreement for sale and purchase. In relation to non-residential property, the stamp duty will in practice be paid upon execution of the assignment upon completion.
| 1. |
In addition to the agreement for sale and purchase, stamp duty is payable on the following documents:
| a. |
Assignment for a residential property – if ad valorem stamp duty has been paid on the agreement, the stamp duty payable on the assignment is $100.
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| b. |
Where a residential property transaction has more than one agreement for sale and purchase – If the date of the provisional agreement and the date of the formal agreement are more than 14 days apart, besides ad valorem duty is payable for one of the agreements, the other agreement is subject to $100 stamp duty. |
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| c. |
Deed of Gift – where an owner assigns his property to another party free of any consideration (that is, by way of gift), stamp duty will still be payable on the market value of the property at the time of the gift as assessed by the Rating and Valuation Department. |
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| d. |
Nomination in respect of a residential property – if a purchaser, after signing an agreement for sale and purchase with a vendor, enters into a nomination requesting the vendor to assign the property to the nominee stated in the nomination, ad valorem stamp duty will be payable on the nomination as on an agreement for sale and purchase of the property, unless the nominee is a trustee, parent, spouse or child of the purchaser. |
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| 2. |
With effect from 1 April 2010, the rate of ad valorem stamp duty is as shown below:
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Price
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Stamp duty
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$2,000,000 or below
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$100
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$2,000,001 to $2,351,760
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$100 + 10% of excess in price over $2,000,000
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$2,351,761 to $3,000,000
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1.5% of price
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$3,000,001 to $3,290,320
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$45,000 + 10% of excess in price over $3,000,000
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$3,290,321 to $4,000,000
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2.25% of price
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$4,000,001 to $4,428,570
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$90,000 + 10% of excess in price over $4,000,000
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$4,428,571 to $6,000,000
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3% of price
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$6,000,001 to $6,720,000
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$180,000 + 10% of excess in price over $6,000,000
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| $6,720,001 to $20,000,000 |
3.75% of price |
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| $20,000,001 to $21,739,120 |
$750,000 + 10% of excess in price over $20,000,000 |
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| Over $21,739,120 |
4.25% of price |
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Example 1
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| Price: $3,150,000.00, the stamp duty payable will be as follows: |
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| $45,000.00 + 10% x ($3,150,000.00 - $3,000,000.00) = $60,000.00 |
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| 3. |
Deferring payment of stamp duty:
With effect from 1 April 1999, an application may be made to the Stamp Office to defer the payment of stamp duty. The following conditions have to be satisfied for deferment of payment :
| I. |
An application has to be made to the Collector of Stamp Revenue ("the collector") in the specified form within 30 days of signing the chargeable agreement for sale ("the agreement"); |
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| II. |
Proof has to be produced to the satisfaction of the collector that:
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The vendor under the agreement is registered in the Land Registry as the owner of the property; or
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| b. |
All instrument(s) through which the vendor acquires his rights and interests in the property from the registered owner (that is, if the purchaser purchases from a confirmor, the agreement for sale and purchase between the registered owner and the confirmor) is/are:
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duly stamped; or |
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| ii. |
secured to the satisfaction of the collector by securities given for the payment of the stamp duty chargeable on the instruments in so far as it is/they are not duly stamped. |
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If the application is approved, the time for payment of stamp duty on the agreement will be as follows:
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Where the purchaser does not sub-sell before completion, payment of stamp duty can be delayed to within 30 days of the execution of the assignment of the property on completion. |
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| II. |
Where the purchaser sub-sells or disposes of the property before completion, payment of stamp duty can be delayed to within seven days of the date of signing the agreement to sub-sell/dispose of the property.
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If the application is not approved, the collector will notify the applicant (or his solicitors) and require the applicant to pay the stamp duty payable.
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| 4. |
Time for payment of stamp duty:
If there is no approval for deferment of payment of stamp duty, the time for payment of stamp duty will be as follows:
| I. |
If the formal agreement for sale and purchase of residential property is signed within 14 days of the signing of the provisional agreement for sale and purchase, stamp duty has to be paid within 30 days of the signing of the formal agreement. |
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| II. |
If the formal agreement is signed more than 14 days after the signing of the provisional agreement, stamp duty has to be paid within 30 days of the signing of the provisional agreement. |
The time for payment of stamp duty on assignment is within 30 days after the date of execution of the assignment.
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