Amendments to Land Tax Act 1915:
Landlord may recover land tax from Tenants
Landlord=s of commercial and industrial properties (and retail properties not governed by the Retail Shop Leases Act) are now able to pass on land tax to Tenants. The change only applies to leases entered into after 30 June 2009.
The Revenue and Other Legislation Amendment Act 2009 has removed the current restriction in the Land Tax Act 1915 preventing Landlord=s of commercial and industrial properties from recovering land tax from their Tenants.
The recovery of land tax will only apply to new leases entered into on or after 1 July 2009.
However, the prohibition on the recovery of land tax still applies to:
$ leases subject to the Residential Tenancies Act 1994 and the Retail Shop Leases Act 1994;
$ any lease entered into before 1 July 2009;
$ where a lease arises from an option to renew being exercised under a lease entered into before 1 July 2009; or
$ an assignment of a lease entered into before 1 July 2009.
At JJ Riba & Company we have updated our commercial and industrial lease precedents to take into account the effect of the legislative changes.
Landlord=s and Tenant=s entering into a new lease on or after 1 July 2009 will be in a position to negotiate whether the Tenant will be liable to contribute to the Landlord=s land tax liability and ensure this is explicit in the lease.
Tenants in leases entered into before 1 July 2009 should ensure that options for renewal in their current leases are correctly exercised to ensure that any new lease arising from that exercise continues the prohibition.
Asbestos Regulations for Landlords
Under Workplace Helath and Safety Regulations which came into force on November 1 2000, and updated on January 1 2006, if you are the "person in control"** you are responsible to find out if your building contains asbestos if it was given building approval before 1990. This division applies only to a building or part of a building that is a workplace.
If the above applies then you are required to:
1. Take steps to find out if there is any asbestos containing materials in the building.
2. Have a Asbestos Containing Materials Report on this material.
3. Keep an Asbestos Containing Materials Register for the buildings.
4. Have Risk Assessments done on all asbestos containing materials found.
5. Create and have in place an Asbestos Management Plan.
6. Review and update this plan at least annually if asbestos containing materials are found.
7. Display at an appropriate palce a notice that there is an Asbestos Materials Register and have in place suitable signage and labeling as part of measures to control exposure to asbestos.
8. Before sale, lease, dismantling or demolishing have carried out the above steps.
9. If you have previously had an asbestos report created you have until 2008 to have it brought up to the new standard.
**"Person in control" means, in realtion to premises, a person who has control of the premises used as a workplace. The person with control may be:
a. The owner of the premises.
b. A person who has, under any contract or lease an obligation to maintain or repair the premises.
c. A person who is occupying the premises.
d. A person who is able to make decisions about work undertaken on the premises.
e. An employer at the premises.
Information on Abestos Regulations for Landlords has been summarised from the Asbestos Audits Queensland website. Further information is available at the Workplace Health and Safety website.
Franchising
Amendment to the Franchising Code of Conduct
These changes include:
- Changes to the Disclosure Requirement - All Disclosure Documents should be updated to comply with the new code requirements.
- A new requirement that all Franchisees receive copies of all documentation which they will be required to execute at least 14 days prior to execution of that documentation.
- Franchise Agreements may no longer contain a waiver of representations.
- International Franchisees must now provide Disclosure regardless of the number of Franchises issued in Australia.
Tax and Trusts
Did you know that the ATO has produced a ruling that will allow the transfer of assets between two trusts that have the same beenfitiaries and terms - exempt of Capital Gains Tax ? This will allow for succession planning without paying CGT.
Business Negotiations / Franchising
The ACCC have warned that they will "get tough" in relation to unconscionable conduct.
Mr Samuel of the ACCC said that it is unconcscionable conduct to include in contracts a variation clause that allows a stronger business to vary an arrangement to the detriment of another party.
Mr Samuel also said that it was better to prosecute big business for unconscionable conduct than to challenge firms for misuse of their market power under section 46 of the Trade Practices Act.
