NSW Stamp Duty Exemption

NSW Stamp Duty Small Business Insurance Exemption

If you are represented by a broker and want to make a Declaration, please contact them direct. Otherwise, please read the following.


The NSW Government has created a new small business stamp duty exemption in the Duties Act 1997 (NSW) (the Act) for eligible insurance acquired on or after 1 January 2018. In order to get the benefit of the exemption, you must:

  • be an eligible small business; and,
  • provide a Declaration to your insurer in an approved form.


What types of insurance are eligible for the exemption?


The types of insurance that may be eligible include:

  • Commercial vehicle insurance, for a motor vehicle that is used primarily for business purposes.
  • Occupational indemnity insurance (including professional indemnity) covering liability arising out of the provision by a person of professional services or other services (other than medical indemnity cover).
  • Product and public liability insurance covering liability for personal injury or property damage occurring in connection with a business or arising out of the products or services of a business.
  • Commercial aviation insurance for an aircraft that is used primarily for business purposes.

    Special definitions apply to each of these insurances so we recommend you refer to section 259B of the Act for full details. Insurers will only apply the exemption where they determine the policy is affected (in whole or part).

When does the exemption apply?

The exemption only applies if the eligible insurance is in a contract effected (new business and variations) or renewed on or after the 1 January 2018.


Definition of a small business

The legislation is complex and unfortunately your insurer is not permitted to assist you in determining if you may be eligible for the exemption. We recommend you seek professional advice to help you understand if the exemption applies to you.

The small business definition would usually capture an individual, partnership or trust carrying on a business where their aggregated turnover (as defined in the Act) in the relevant period is less than $2 million. There are several options to determine how the “relevant period” is defined.

Please see section 259A of the Duties Act 1997 for full details and/or seek appropriate advice.


How do I make the required Declaration?

The insured person must provide a Declaration that they are eligible for the exemption at the time the relevant insurance is effected or renewed. If you want to make a Declaration, please see options below.

  • Option 1: If you have not paid your premium, please call the number listed on your policy document to make the Declaration and we will deduct the stamp duty from your policy.

  • Option 2: If you have already paid your premium and want to make the Declaration, please tick the box below.
If the required Declaration is received after the time that the contract of insurance is effected or renewed, and the insurer is unable to recover the stamp duty already paid because of this, the insurer reserves the right not to make any premium adjustment or refund or deduct the reasonable costs of any recovery.

Remember: if you are represented by a broker and want to make a Declaration, please contact them direct.


What happens if I make a false Declaration?

We recommend you obtain appropriate professional advice and/or otherwise reasonably satisfy yourself that the Declaration is not false or misleading as penalties may apply for providing false or misleading information. More information is in our FAQs.

If the Declaration is false (whether dishonest or not) and this causes the insurer to be liable to pay a duty the insurer may require you to pay an amount equal to the duty, together with any interest or penalty tax payable.

If the required Declaration is received after the time that the contract of insurance is effected or renewed and the insurer is unable to recover the stamp duty already paid because of this, the insurer reserves the right not to make any premium adjustment or refund or deduct the reasonable costs of any recovery.


How do I get more information?

Our FAQs provide more information. You can also go to NSW Revenue website and/or refer to the Duties Act 1997 (NSW).

Declaration




Frequently Asked Questions

Please note if you are represented by a broker and want to make a declaration, please contact them direct.

Following the 2017 NSW Budget, the NSW Government created a new small business stamp duty exemption in the Duties Act 1997 (NSW) (“the Act”) for eligible classes of business effected (including endorsements) or renewed after 1 January 2018.

In order to get the benefit of the exemption, you must:

  • be an eligible small business; and,
  • provide a declaration to your insurer in an approved form.
NSW Insurance Stamp Duty is a tax on insurance premium which is collected by insurers and paid to Revenue NSW when a customer makes a payment of premium on his or her policy.

Types of insurance that may be eligible include:

  • Domestic Motor and Commercial Motor insurance, for a motor vehicle that is used primarily for business purposes.
  • Occupational indemnity insurance (including professional indemnity) covering liability arising out of the provision by a person of professional services or other services (other than medical indemnity cover).
  • Product and public liability insurance covering liability for personal injury or property damage occurring in connection with a business or arising out of the products or services of a business.
  • Commercial aviation insurance for an aircraft that is used primarily for business purposes.
  • Special definitions apply to each of these insurances so we recommend you refer to section 259B of the Act for full details. Insurers will only apply the exemption where they determine the policy is affected (in whole or part).

The legislation is complex and insurers are not permitted to assist customers in determining if you may be eligible for the exemption. We recommend that you seek professional advice to help you understand if the exemption applies to you.

The small business definition would usually include an individual, partnership or trust conducting a business where the aggregated turnover (as defined in the Act) in the relevant period is less than $2 million. There are several options to determine how the “relevant period” is defined. Please see section 259A of the Act for details and/or seek appropriate advice.

You must provide a declaration that you are a “small business” (as defined in the Act) at the time the relevant insurance is effected or renewed.
Yes. You will be able to seek a stamp duty exemption on any policy that is effected or renewed on or after 1 January 2018.

We recommend you seek appropriate professional advice to ensure your declaration is not false or misleading as:

  • There is a maximum penalty of $11,000 under the Act if the declaration is provided knowing that it is false or misleading; and
  • If the declaration is false (whether dishonest or not) and this causes the insurer to be liable to pay a duty the insurer may require you to pay an amount equal to the duty, together with any interest or penalty tax payable.
Please visit the NSW Revenue website and/or refer to the Act.