COMPANY TITLE: FREQUENTLY ASKED
What is Company Title?
Company Title is a common form of property ownership in N.S.W. It differs from more common forms of title such as Torrens Title and Strata Title, as in Company Title ownership is attained through ownership in shares in a corporate entity (or “Company”) which is incorporated with the Australian Securities an Investment Commission (ASIC). Essentially, the Company Title owner has, rather, a right to occupy a defined area in the company’s building (e.g., apartment no. 17) by virtue of owning a set number of shares in the company which owns the building (the home unit company).
How is Company Title different from Strata Title Property?
Company Title property is quite similar to a Strata Title property. The main difference is that you own “shares” in the Company which entitle you to exclusive rights in the home unit/townhouse rather than ownership by the conventional Certificate of Title.
Can I borrow on the Company Title?
Most Banks and Building Societies will lend and mortgage on the shares. Just like Strata Title each lending institution will have different lending requirements and pre-approval is recommended before entering into a contract.
Do I pay Capital Gains Tax on Sale of the shares?
Not if you purchase the unit as your home. The Income Tax Assessment Act excludes the family home, including a Company Title family home, from the provisions of Capital Gains Tax.
Do I still pay Land Tax?
Company Title units are deemed to be strata lots and therefore, although normally a Company would be liable to pay land tax, a Company Title unit is treated differently. The individual lodges a Land Tax return for his home or unit and it is dealt with in the same fashion as any normally titled residential property would be dealt with.
What about stamp duty?
Stamp duty legislation provides for standard ad valorem rates on the stamping of Company Title shares so that stamp duty is paid as if the unit is held under Strata Title. The First Home Owners Grants and stamp duty concessions apply equally to Company Title as to other conventional titles.
How does the conveyancing procedure vary from strata title conveyancing?
The purchase of a Company Title unit is complex and involves consideration of many matters outside the normal scope of a traditional conveyance of strata title property .It should only be handled by solicitors’ experienced in Company Title.