653AI Death

Summary

This section provides for when a liable person dies.

Details

(1) For the purposes of Part 22A, ‘personal representative’ has the meaning given to it in Chapter 1 of Part 32 and is considered a single continuing body of persons.

(2) Section 1047 (liability of parents, guardians, executors and administrators) and 1048 (assessment of executors and administrators) apply for the purposes of the residential zoned land tax subject to the following adaptions:

• (a) a reference to “income tax” means a reference to ‘residential zoned land tax’
• (b) a reference to “profits or gains” means a reference to the market value of a relevant site; and
• (c) a reference to “Income Tax Acts” means a reference to ‘Part 22A’.

(3) The personal representative will be deemed to be the liable person in relation to a site immediately following the death of the liable person, and will continue to be so until the administration of the estate of the deceased is complete, and another person becomes the new liable person in respect of a site to which this Part applies.

(4) The personal representatives of the deceased person shall be responsible for all obligations under this Part as if:-

• (a) the personal representatives acquired the relevant site at the time it was acquired by the deceased person,
• (b) the transfer of the site to the personal representative will not be treated as a change of ownership for the purposes of Chapter 5,
• (c) a provision of this Part that applied to the site in question prior to the death of the deceased person continues to apply after their death.

(5) Notwithstanding the provisions of section 653Q in relation to the charge to residential zoned land tax, but subject to subsections (6) and (7), tax arising in respect of liability dates in the period after the death of the deceased and before the administration of the estate is completed (referred to as ‘post-death tax’) is due and payable at the earlier of -

• (a) 12 months from the grant of probate or grant of letters of administrations of the deceased persons estate, or
• (b) 24 months from the date of death of the deceased person.

(6) Subject to subsection (7), where the administration of the estate is completed prior to any tax becoming due and payable under subsection (5), then the post-death tax is no longer due and payable.

(7) The provisions of subsections (5) and (6) only apply if a return is filed in respect of each relevant site within the deceased person’s estate in accordance with section 653U for each return date that arises from the date of death to the earlier of the time periods set out in subsection (5).

(8) Where a site that was determined to be unsuitable for development due to its physical condition was owned by the deceased person immediately prior to their death, the personal representatives may make a claim for a refund of tax under section 653AD(5) during the administration period.

(9) Where at the date of death the provisions of section 653AE apply to a site in respect of which the deceased person was the owner, the personal representatives may:

• (a) claim a refund of tax under section 653AE(3) during the administration of the estate if the deceased person would have been so entitled, and
• (b) make a claim to defer residential zoned land tax under section 653AE(4) during the administration period if the deceased person would have been so entitled and tax so deferred that becomes payable during the administration period will become a charge on the land under section 653Q(4).

(10) Where at the date of death the provisions of section 653AF apply to a site in respect of which the deceased person was the owner, the personal representatives may:

• claim a refund of tax under section 653AF during the administration of the estate if the deceased person would have been so entitled, or
• make a claim to defer residential zoned land tax under section 653AF(3) during the administration period if the deceased person would have been so entitled and tax so deferred that becomes payable during the administration period will become a charge on the land under section 653Q(4).

(11) If, on the date of death, tax is deferred under section 653AH on a relevant site of which the deceased person was the owner, the personal representative takes the place of the deceased person for the purposes of applying the provisions of section 653AH in respect of a relevant site to which the deceased was the liable person prior to their death. Tax deferred under section 653AH(4) will become a charge on the land, in accordance with section 653Q(4), at the end of the administration period.

(12) Notwithstanding subsections (9)(b), (10)(b) or (11)(b), a beneficiary of a site to which section 653AE(4), 653AF(3) or 653AH(4) was applicable at the end of administration takes the place of the deceased and may continue to apply those provisions, as if the beneficiary was the liable person in respect of the relevant site at the date of death of the deceased.

(13) Any charge on the land that arises under subsections (9)(b), (10)(b) or (11)(b) shall cease to apply if the tax to which the charge relates would not be payable by a beneficiary of the relevant site to which the charge relates, had they been the liable person with respect to that relevant site at the date of death of the deceased person.

Relevant Date: Finance Act 2021