There are several reasons why transferring real property in NSW is necessary. For example, if your marriage or de facto relationship breaks down and a property is included in the settlement. Or if you’re just starting your marriage or de facto relationship and considering sharing your properties with your loved one. You may also want to gift a property as an inheritance to your child or children, siblings or even friends. Whatever your reason is, understanding the process of transferring real property in NSW can help you to have a successful transaction.
Before, transferring real property in NSW involves changing the Certificate of Title (CT) from one person to another. The Certificate of Title is a legal document listing the official owner(s) and outlining the boundaries of a parcel of land.
As of 1 July 2019, all property transfers must be lodged electronically via eConveyancing. However, as NSW progressed to 100% electronic lodgement of land transactions, there have been further changes to the land title system. This includes the abolition of Certificate of Titles.
On 11 October 2021, the Real Property Amendment (Certificates of Title) Act 2021 officially commenced. The Act abolished the CTs and the control of the right to deal (CoRD) framework. This means that NSW Land Registry Services (NSW LRS) will no longer issue CTs and all existing CTs are cancelled. Hence, CTs will no longer be required for any property dealings.
Changes in the land title system and eConveyancing requirements should be carefully considered when planning a property transfer. Moreover, while the process is now digital, there are still various documents that you need to prepare before lodging a transfer. Hence, the state government recommends seeking the assistance of a conveyancer when transferring real property in NSW.
The process of transferring real property in NSW includes:
While the process of completing a property transfer may seem simple, the legal requirements can be quite daunting. It can also become complex depending on your circumstance and the type of transaction you want to perform.
Not all marriages have a happy ending. It is also not uncommon for spouses to separate after being together for some time. Property settlements are usually one of the matters that you must go through after finalising your divorce or separation.
If you are making a transfer according to a binding financial agreement, you may seek for an exemption of duty. To apply, you need to complete an exemption form and provide a copy of supporting documents, e.g., binding financial agreement.
Some property owners may hold a property on a trust or transfer it into a trust for tax purposes. This may include transferring ownership of a property to your child as a trust fund or holding a property through a superannuation fund.
Trust ownership is when a property is owned by an individual or an organisation, usually to benefit another person. Though not uncommon, this process is quite complex, involves more paperwork, and follows strict rules. Moreover, it can involve tax implications that you also have to consider before proceeding with the transfer.
Married or de facto couples often add their loved ones into the title of a property they own and become joint tenants. This enables them to hold a 50-50 undivided share.
However, some couples are also looking to change ownership shares in their investment properties. From joint tenants, they can apply to change ownership proportions and become tenants in common. When this happens, one of them will hold more share over the property than the other, e.g., 60-40 variation.
Some couples tend to share ownership of a property or change ownership shares as an asset protection strategy. Doing so provides couples some tax advantages, particularly when starting a business. However, this process can have possible capital gains tax implications and affect your pension entitlements.
Parents who are looking out for their child or children must make plans to help set them up for the future. One of their options is to transfer a property as a legal gift instead of leaving it in their will.
While this process is generally quite simple, an existing mortgage on the property can make it rather complex. The transferor or owner must also consider whether the loan will also be transferred to the transferee or person receiving the property. When this happens, the transferee must also undergo a loan approval process first. Moreover, it can involve tax and other financial implications for the transferor.
When an owner of property under joint tenancy passes away, the property is transferred to the surviving joint tenant automatically. This process takes effect regardless of the deceased owner’s Will regardless of their relationship to each other.
If the deceased owned the property as joint tenant with another person, the ownership will pass to the surviving joint tenant regardless of their relationship to the deceased. A conveyancer must lodge a Notice of Death with NSW LRS to transfer the name on the Torrens Title Register.
However, if the deceased-owner is a tenant in common, the surviving tenant(s) in common may need to apply for a grant of probate or administration. The application for grant of probate or administration must be completed before transferring the property to the remaining tenants in common.
The process for transferring real property in NSW can be quite daunting depending on your circumstances. There are a lot of legal and financial considerations that you must understand and make before deciding to proceed with a transfer. Moreover, the 100% eConveyancing policy requires you to seek assistance from a conveyancer for all available property eDealings.
Whatever your reason is for transferring some of your properties, VC Lawyers can help you have a successful lodgement. Our qualified eConveyancers and experienced Property Lawyers can help you draft and prepare all the required documents. We can also assist you in applying for an exemption or completing the payment of your stamp duty.
Our beautiful relationship with financial professionals also enables us to seek further assistance for your tax and government pension considerations. We also have expert Family Lawyers who can assist you with your binding financial agreement and wills preparation.
We will make sure to understand your circumstance and provide the right legal advice to give you the most favourable outcome. Getting the right legal advice can help you understand the consequences of transferring real property in NSW and avoid liabilities and financial complications.
Talk to us to find out how we can achieve the most favourable legal outcome of your circumstances.
NB: This blog post is neither a legal advice nor intended to be such, and is only for general information. The same should not also be taken as a financial or commercial advice. The reader must personally consult their professional adviser/s on the contents of this blog post. VC Lawyers is not liable for any loss or damage, direct or consequential, as a result of the reader’s or a third person’s misconstruction of the wordings or use/misuse of the contents of this blog post.
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