Insurance stamp duty
From 1 January 2018, certain types of insurance for small businesses are not liable for duty in New South Wales.
The Duty exemption will apply for the following types of insurance:
Commercial vehicle insurance – being motor vehicle insurance for a vehicle used primarily for business purposes
Professional indemnity insurance – insurance covering liability arising out of the provision by a person of professional services. Note this does not include the medical profession.
Public Liability and Product insurance – insurance covering liability for personal injury of property damage occurring in connection with a business or arising out of the products or services of a business.
For a policy to be exempt, the insured must be a small business as at the date the policy is effected or renewed, and the insurer must have a small business declaration.
If an insurer does not have a small business declaration as at the date the policy is effected or renewed then the policy is liable to duty.
At present, The Tax Office defines you as a small business entity if you are an individual, partnership, company or trust that is;
Carrying on a business, and
Has an aggregated turnover of less than $2 million.
Aggregated turnover is your annual turnover plus the annual turnovers of any business entities that are associated with you.
If your business meets the above criteria, Addison Partners can assist you in completing the Small Business Declaration that needs to be filed and forwarded onto your insurer. Please contact your accountant for more information or call 02 4995 7300 to make an appointment.