Pen-points
Welcome to Pen-Points
Pen-Points is a place for our team to share our insights into current issues arising within our practice areas.
Can I transfer my property into my SMSF (and do I have to pay stamp duty)
The short answer: yes, if the criteria are met, and in NSW, concessional duty of $750 may apply.
If your property qualifies as ‘business real property’, you may be able to transfer it into your SMSF and access concessional duty under Section 62A of the Duties Act 1997 (NSW). It’s a valuable opportunity—but the rules are strict, and the details matter.
A few key points to keep in mind:
• If multiple members own the property, it must be transferred into the SMSF in the same ownership proportions.
• If ownership proportions differ—or there are additional members—the SMSF Trust Deed may need updating (by adding a segregation clause).
• The concession is not automatic—Revenue NSW will assess eligibility carefully, and full duty may apply if requirements aren’t met.
At Penmans, we regularly assist clients with these transfers and offer a fixed fee package for this service.
These strategies can be highly effective when structured correctly, but getting the setup right from the start is critical.
If you’re considering a transfer, it’s worth having a quick conversation early on to ensure everything is aligned.
Next steps? You can learn more in our fact sheet, or get in touch with our property team here.
When someone offers to prepare a “free” Will, it is a tempting proposition. But are free Wills really free?
A recent Sydney Morning Herald article raised this very question.
The story involved a woman who prepared a Will through NSW Trustee & Guardian (TAG). While the Will itself cost nothing to make, it appointed a government body to act as her executor after her death. When she died, TAG charged a commission reported to be about $56,000, significantly reducing her family’s inheritance. While the commission had been disclosed to the Will-maker, it came as quite a shock to the family after her death.
This example highlights an important point: when preparing a Will, the cost of its preparation is only one part of the overall picture.
If this lady had appointed a family member as executor, and that executor had sought the assistance of an estate lawyer to help administer the estate, the likely fees may have been less than a quarter of the amount actually incurred. Not only could that represent a significant financial saving, but the choice of lawyer and control of the process would remain with the family rather than a government body or institution.
One of the most important decisions in any Will is choosing who will act as executor. The executor is responsible for obtaining a Grant of Probate (if required), collecting the assets of the estate, paying any debts and distributing the estate according to the Will.
There are occasions when appointing a government body as executor is appropriate, but this should be carefully considered in the context of all available options. Appointing a government body to save the cost of preparing the Will may also mean the Will-maker misses the opportunity to receive impartial advice about their executor choice.
A modest fee for proper advice today may save your family significant cost and complexity later.
When should a bare trust deed be signed and stamped?
This is one of the most common questions we receive from clients, brokers and accountants. Unfortunately, there is a lot of conflicting information available, and some of it is incorrect. The rules also vary from State to State. This article relates to properties located in New South Wales.
Getting the timing right when signing and stamping a bare trust deed is critical. A declaration of trust over dutiable property is generally liable for full (ad valorem) duty unless a concessional rate applies. For SMSFs, a concessional rate may be available where a custodian (bare trustee) declares a trust over property to be held for the SMSF trustee.
To qualify for the concession, several conditions must be satisfied. The bare trust deed must name the SMSF as the beneficiary, the purchase price must be provided by the SMSF (including through a limited recourse borrowing arrangement), and full duty must have been paid on the contract.
Importantly, the bare trust deed cannot be stamped before the contract. The correct sequence is for the bare trustee company to be established first, contracts to then be exchanged with the bare trustee named as purchaser (with no reference to the SMSF or the bare trust). This is followed by preparing and executing the bare trust deed (this is done after exchange, because at that point the bare trustee has the legal right to acquire the property, so can make the declaration of trust).
The deed should then be stamped at the same time as or after the contract, and within three months of execution.
In practice, we often see bare trust deeds signed — and sometimes even stamped — before contracts are exchanged, particularly where lenders request a stamped deed during the loan approval process. Unfortunately, providing a stamped deed this early is not possible while still complying with the strict timing requirements.
At Penmans, we regularly work with brokers and lenders to explain the correct timing and ensure SMSF property transactions are structured properly from the outset. Getting this right can make all the difference in avoiding unnecessary duty and ensuring the transaction proceeds smoothly.
If you need assistance with stamping a bare trust deed or any SMSF property transaction, our experienced team would be happy to help. You can read more about our SMSF services here.
Do I Really Need a Lawyer for This Dispute??
When a dispute arises, it can be difficult to know whether engaging a lawyer is the right next step. Legal action can involve time, cost and uncertainty — and in some cases, it may not be commercially worthwhile.
With Penmans, the first step is simple.
Call us.
What Happens When You Call?
You’ll be put through to Michael or Nathan, both law clerks in our dispute resolution team, who are studying to be lawyers themselves. They will ask you a series of questions to gain an initial understanding of your situation and help determine if Penmans might be able to help solve your problem, and if so, the next best step.
What happens next?
Not every dispute requires formal legal representation. Sometimes early direction is enough to help you decide how to move forward.
After your initial call, the next step might be:
- A free 15-minute introductory call with one of our dispute resolution lawyers; and/or
- Our $550 fixed-fee Road Map service, where we review your key documents, outline your options and provide a clear plan forward.
Our aim is to give you clarity before you commit to significant legal costs.
If you’re unsure where you stand, a simple phone call can provide the direction and confidence you need to take the next step.
Ready to make that step? Call us 02 4324 1266 or complete our contact form and we will be in touch.
Granny flat arrangements are becoming more common as they respond to a mix of financial, social and lifestyle pressures facing Australian families.
One of the biggest drivers is housing affordability. As property prices rise, many older Australians are choosing to sell their homes and contribute funds to live with or near family, rather than purchasing another property outright.
These arrangements are also increasingly attractive from a retirement and aged care planning perspective. When structured correctly, a granny flat arrangement can provide long-term housing security, support independence, and help protect Centrelink entitlements, such as the Age Pension.
While commonly referred to as a Granny Flat Agreement, the scope of these arrangements is flexible and can be tailored to suit individual family circumstances.
A typical example is where an older family member sells their home and contributes funds to build a second dwelling on the property of an adult child, which the older person then occupies.
Without the correct legal structure, this contribution may be treated by Centrelink as a gift under the deeming rules, potentially affecting Centrelink entitlements.
To avoid this outcome, the arrangement must qualify as a Granny Flat Interest. This requires that:
- the older person has a legal right to occupy a residential property for life, and actually resides there; and
- the older person has made a payment or provided valuable consideration in exchange for that right.
If you are considering a Granny Flat Arrangement and want certainty, clarity and peace of mind, the Penmans team can help you structure the agreement correctly from the outset. We offer a fixed fee package for most Granny Flat Agreements.
You can read more about our services here.
In an age of digital convenience, it’s tempting to believe that artificial intelligence and online templates can replace the careful guidance of an experienced lawyer and save you money.
When it comes to estate planning, however, the decisions you make are far too important to leave to automated forms or generic advice. This is because your estate plan is so much more than a set of documents — it’s a roadmap for the future.
At Penmans, we’ve seen firsthand the problems that arise when people try to “DIY” their Will.
AI tools and online templates operate on one-size-fits-all logic. They produce documents, but they cannot give advice or understand the nuances of your life — blended families, estrangements, business interests, trusts, superannuation, or property held across different jurisdictions. Documents are provided, but not advice.
By contrast, an experienced lawyer can, in consultation with your accountant or financial advisor, integrate all these components into a cohesive strategy which reflects your wishes.
Ultimately AI provides cookie cutter documents that often fail to meet the needs of real people. Documents are signed and filed away. Often the next time they are looked at is after the person has died.
Hindsight can indeed be a profound teacher, when it is too late to correct problems.
By working with a lawyer who specialises in estate planning, you ensure your documents are valid and enforceable from the outset, reducing the likelihood of disputes and providing peace of mind for your family.
AI tools can process information, but they can’t understand your values, family relationships, or emotional priorities. Estate planning is deeply personal. A good lawyer doesn’t just draft documents — they guide you through sensitive conversations, help you make clear decisions, and ensure your legacy reflects who you are.
The problem with cookie cutter documents is that you have no way of knowing if they are adequate for your circumstances, or not.
Sometimes it is surprising for clients to learn that they cannot do what they thought. For example, where a property that they see as theirs is actually held in a family trust or SMSF. That property cannot be gifted in a Will (it must be dealt with in other ways).
The problem with AI is it will only produce documents based on what you tell it.
And you don’t know, what you don’t know (and neither does AI).
Using AI or online tools might seem quicker or cheaper, but legal matters are one area where professional guidance pays off in certainty, clarity, and peace of mind.
Conveyancing is so much more than transferring a property from person A to person B. But it can be made to seem that simple.
It is true that many conveyancing transactions do go smoothly. However, conveyancing is the area of legal practice where the most problems arise, and when something goes wrong in a conveyancing matter, it tends to go wrong badly.
The Penmans difference is that not only do we have highly experienced and knowledgeable licensed conveyancers, but they are backed up by specialist property lawyers (including one of only a few accredited specialists in property law in our area).
Penmans do not pass matters around between our team members depending on what stage they are up to (for example pre or post exchange of contracts). At Penmans the person who is responsible for your matter, stays responsible for the whole matter.
This means you truly get the whole package when you appoint Penmans as your conveyancer. You get competitive fixed fees, highly skilled conveyancers, and the reassurance that our team has the specialist skills and experience if complications do arise.
Our fixed conveyancing fees mean you don’t have to compromise on something so important.
If you have a family trust there is a high likelihood that its trust deed is an off the shelf document that was arranged by your accountant when the trust was first established.
Surcharge transfer (stamp) duty and surcharge land tax have been imposed on foreign persons and foreign entities since 21 June 2016. Since 1 January 2021, discretionary trusts are deemed to be foreign trusts unless the possibly of a distribution of any of the trust assets or income to a foreign person is specifically and irrevocably excluded.
To ensure that foreign surcharge duty or land tax is not imposed it essential that the trust deed is carefully reviewed. Often amendment of the trust deed is necessary.
Revenue NSW is currently examining many transactions that have taken place over the last few years and is retrospectively imposing surcharge transfer duty and/or surcharge land tax where a residential property has been purchased by a discretionary trust and the trust deed has either not been updated or has not been updated properly.
We have seen cases where a trust has owned property since well before 2016, but Revenue NSW has retrospectively imposed surcharge land tax.
If you need help with a Revenue NSW audit you can read our Pen-Points article below for more information.
If you are not sure if your trust deed needs to be updated, you can read more about our fixed fee package for that service here.
Positive Covenant and Restriction on Use for Onsite Detention System
Why do I need a Positive Covenant and Restriction before Council will give me my Occupation Certificate?
The registration of a positive covenant and restriction for an onsite detention system (or similar) (OSD) is often one of the final hurdles before an Occupation Certificate can be issued in respect of a new build.
These are sometimes referred to as “Section 88E requirements”. Essentially, they create both the right in favour of the Council for the OSD to be installed and remain on the land, and also govern the restrictions on how that affected part of the land can be used. They create a permanent interest in the land in favour of the Council.
What is a Positive Covenant and a Restriction?
A positive covenant is a legal obligation imposed on the owner of a property to do something, rather than refrain from doing something (which would be a negative or restrictive covenant). Common examples include the obligation to:
- Maintain a shared driveway or retaining wall
- Contribute to the cost of communal infrastructure
- Preserve landscaping or environmental features
- Provide access to services or amenities for adjoining properties
These covenants are frequently used by developers or local councils to ensure long-term compliance with development conditions and infrastructure maintenance.
A restriction does exactly what it says. It restricts the owner of a property from doing something on its own land.
Why are they needed for Onsite Detention Systems (and similar infrastructure)?
Where onsite infrastructure for stormwater detention etc is required as part of a Development Consent, Councils require a permanent interest to be created in the land to enable the infrastructure to be installed, utilised and maintained (the Positive Covenant). Council also requires the permanent legal right to prevent the owner from interfering with the infrastructure (the Restriction).
How Penmans Can Help
Every week the Penmans property team help new and existing clients with this final hurdle in the development process. We understand that by the time you get to this stage you just want it done!
We understand this, which is why we are the law firm of choice for surveyors and builders all over NSW to assist with getting this requirement met smoothly for their clients.
It does not matter where in NSW your property is, we can help, and we will do so for a fixed fee.
Next steps
Download our fixed fee package on Positive Covenants and Restrictions.
Complete our contact form and a member of our property team will be in touch with you shortly.
Recently Penmans have been instructed in a number of matters where a client has received a Notice of Investigation from Revenue New South Wales following their purchase of a residential property.
These investigations relate to the imposition of surcharge purchaser duty pursuant to the Duties Act 1997 in relation to foreign persons.
This correspondence informs the client that they may be liable for significant extra transfer duty and often penalties and interest. This correspondence can be quite disturbing to receive.
Penmans are well versed in the handling of claims against solicitors or conveyancers arising from a failure to advise at the time the conveyancing matter was conducted about the imposition of surcharge transfer duty for foreign persons. Penmans have successfully negotiated settlements with both Lawcover and the insurer for licensed conveyancers.
We understand that receiving a letter from Revenue New South Wales of this nature is very stressful.
If this has happened to you we encourage you to complete our contact form and let us know that you have received a letter from Revenue New South Wales in respect of surcharge transfer duty. A member of our disputes team will be in contact with you to discuss your options.