NSW Deceased Estate Transfer Duty Concessions

When a property passes from a deceased estate to a beneficiary in New South Wales, the transfer does not automatically attract standard transfer duty. Revenue NSW offers a concessional, nominal duty rate for these transfers, provided the transfer genuinely reflects what the will, or the rules of intestacy, actually set out. Understanding how this mechanism works, and where it can fall over, helps executors and beneficiaries avoid an unwelcome duty assessment landing well after probate has already been granted.

Why NSW Offers a Concession for These Transfers

Transferring a home or investment property is normally treated as a dutiable transaction because ownership is changing hands. Deceased estate transfers are different in substance: the beneficiary is simply receiving what they were always entitled to under the will or under intestacy law, rather than purchasing something. Recognising this, the Duties Act 1997 sets a concessional, nominal rate of duty for transfers that are made under and in conformity with a deceased person's will, or in accordance with the rules that apply when someone dies without a valid will.

The Legal Mechanism Behind the Concession

The relevant provision is commonly referred to by conveyancers and solicitors handling property transfers as the deceased estate concession. It applies to a transfer of dutiable property by the legal personal representative, meaning the executor or administrator of the estate, to a beneficiary. The key legal test is not simply that the beneficiary was named in the will, but that the actual transfer being lodged matches what the will (or intestacy rules) directed should happen with that specific asset.

What Counts as "In Conformity With the Will"

A transfer is generally treated as being in conformity with the will when the property goes to the exact person or people named as entitled to it, in the proportions the will sets out, without any side agreement changing who ends up with what. This includes property passing exactly as directed, distributions following intestacy succession rules where there is no will, and transfers reflecting a court order that has varied a contested will. An executor exercising a genuine power of appropriation, effectively choosing to give a beneficiary property instead of cash where their overall entitlement stays the same, can also qualify.

When the Concession Does Not Apply

The concession is lost, at least for the affected portion, when beneficiaries agree among themselves to redistribute the estate differently from how the will or intestacy rules actually provided. A common example is where three siblings inherit a property equally but agree that one sibling will take the whole property and pay the others out. Because that outcome does not match the will's actual terms, ordinary transfer duty applies to the part of the transaction that varies from those terms, even though it still relates to a deceased estate.

Executors, Administrators and Who Can Apply

The application for the concessional rate is made by the legal personal representative, being the executor named in the will and granted probate, or the administrator appointed where someone dies without a will and letters of administration are issued instead. Beneficiaries themselves do not apply directly; the request is lodged as part of the broader administration of the estate, usually once probate or letters of administration have been obtained and the executor is ready to formally transfer title.

Documents Your Conveyancer Will Need

Expect to provide a certified copy of the grant of probate or letters of administration, the will itself where one exists, a schedule identifying the relevant asset within the estate, and a completed declaration confirming the transfer matches the will's terms. Where beneficiaries have varied their entitlements, a current valuation of the affected property is usually required so duty can be correctly assessed on the varied portion. Your conveyancer will typically manage this process alongside the executor's solicitor if a separate estate lawyer is also involved.

Capital Gains Tax Considerations

Transfer duty concessions are separate from capital gains tax, which can still apply when the property is eventually sold by the beneficiary rather than at the point of inheriting it. The cost base used for future capital gains tax purposes depends on factors including when the deceased originally acquired the property and whether it was their main residence, which is a genuinely technical area. This article provides general information only, not tax advice, and beneficiaries should speak with an accountant about their specific position, drawing where useful on the ATO's guidance on property and capital gains tax.

Timing the Transfer Within the Estate Administration

Executors are not required to rush a transfer through immediately after probate is granted, and in many estates it makes sense to resolve other matters first, such as finalising debts, valuing other assets, or waiting out any period during which a will could still be contested. The concessional duty rate is generally available whenever the eventual transfer is lodged, provided it still reflects the will's original terms at that point, so there is usually no need to feel pressured into transferring title before the wider estate administration is otherwise ready.

Getting the Transfer Right the First Time

Because an incorrectly assessed concession can be reassessed later, with ordinary duty and interest then becoming payable, it is worth engaging a conveyancer familiar with New South Wales deceased estate transfers early in the estate administration process, rather than after title has already been prepared for transfer. This is especially important where the property in question involves an older title with a granny flat or other complicating feature, or where the underlying title itself is unusual, such as land still held under Old System title rather than the modern Torrens register. Further detail on the concession's documentation requirements is available through Revenue NSW's guidance on deceased estate transfers, and executors dealing with a more complex estate, such as one involving multiple properties or overseas beneficiaries, should also seek advice from the estate's own solicitor alongside their conveyancer.