Part 3Part 3 Entitlements arising from capital reductions or rights alterations
124 Abolition of duty charged by this Part—effective 1 July 2013
(1) The duty charged by this Part is abolished on and from 1 July 2013.(2) The duty charged by this Part remains chargeable on a dutiable entitlement that is acquired before 1 July 2013.
(1) In this Part:capital reduction means:
(a) the redemption, surrender or cancellation of a share (including cancellation as part of a buy-back of shares in accordance with Division 2 of Part 2J.1 of the Corporations Act 2001 of the Commonwealth), or(b) a reduction in the paid up value of a share.company means a NSW company that is:
(a) a public company within the meaning of the Corporations Act 2001 of the Commonwealth, and(b) not listed on the Australian Securities Exchange or a recognised stock exchange.dutiable entitlement means a voting share entitlement in respect of whose acquisition a statement is required, under section 129, to be lodged.
person includes persons who are associated persons.
Note.Associated person is defined in the Dictionary.
rights alteration, in relation to voting shares, means a variation, abrogation or alteration of rights relating to the shares.
voting shares has the same meaning as in section 9 of the Corporations Act 2001 of the Commonwealth.
(2) For the purposes of this Part, if voting shares acquired by associated persons severally do not, but taken in the aggregate would, confer an entitlement to which this Part applies, the voting shares acquired by the associated persons are taken to be aggregated and are taken to confer the entitlement on the associated person who last acquired any of those voting shares.(3) If, by subsection (2), an entitlement to voting shares is taken to exist as the aggregate of voting shares of associated persons, the associated persons are jointly and severally liable for payment of the duty chargeable on the statement required to be lodged under this Part.(4) Voting shares are not to be aggregated in accordance with subsection (2) if the Chief Commissioner is satisfied that the associated persons concerned acquired their several shares independently and for no common purpose.
126 When does a liability for duty arise?
A liability for duty charged by this Part arises when a dutiable entitlement is acquired.
A tax default does not occur for the purposes of the Taxation Administration Act 1996 if duty is paid within 3 months after the liability to pay the duty arises.
128 Who is liable to pay the duty?
(1) Duty chargeable under this Part is payable by the person who acquires a dutiable entitlement.(2) If the dutiable entitlement results from an aggregation of the voting share entitlements of associated persons, the associated persons are jointly and severally liable for payment of the duty.
129 Entitlement to voting shares arising from capital reduction or rights alteration
(1) If:(a) a person becomes entitled to at least 50% of the voting shares of a company by means of capital reduction or rights alteration, or both, or(b) a person who is entitled to at least 50% of the voting shares of a company becomes entitled to at least 10% more of the voting shares over a period of not more than 12 months by means of capital reduction or rights alteration, or both,the person must lodge a statement with the Chief Commissioner in respect of the entitlement.(2) The statement must be lodged within 3 months after the entitlement arises.
The statement required to be lodged under this Part by a person is to be in an approved form and is to contain the following information:(a) the name and address of the person,(b) the name of the company,(c) the date on which each relevant capital reduction or rights alteration, or both, occurred,(d) if the person’s entitlement has arisen:(i) from capital reduction—the total of the unencumbered value, immediately prior to each relevant capital reduction, of the shares the subject of the capital reduction, or(ii) from rights alteration—the total of the unencumbered value, immediately prior to each relevant rights alteration, of the shares the subject of the rights alteration, or(iii) from capital reduction and rights alteration—the aggregate of the totals under subparagraphs (i) and (ii),(e) the total consideration paid to the person in relation to all relevant capital reductions or rights alterations, or both,(f) such other information as may be required by the Chief Commissioner.
A statement required to be lodged under this Part by a person is chargeable with duty of 60 cents for every $100, or part, of the higher of:(a) the total or aggregate obtained under section 130 (d), and(b) the total obtained under section 130 (e).