If you are planning to restore a vehicle that has never been registered in your name, just get it roadworthy, register it and pay the stamp duty on its market value at that stage, cancel the registration, finish restoring it and then re-register it. If you wait until finishing the restoration before registering the vehicle, you pay stamp duty on its restored value rather than the value at the time of acquisition.
Further below is the actual response from Urban Services to an enquiry an MRA member made regarding Stamp Duty payable on initial registration of a restored vehicle. To paraphrase, the law states that you have to pay stamp duty on the market value at time of initial registration and the law is the law (or in other words “tough luck”).
To seek a change to this law so that stamp duty applies on the market value at the time of acquisition rather than time of registration, contact your local member of the ACT Legislative Assembly and the ACT Minister for Urban Services.
Reference Number: 2335
Topic: Transport, Road & Traffic
Sub Topic: Vehicle registration
Thank you for lodging the following online customer comment with the ACT Government.
“If I acquire an unroadworthy vehicle for say $100 and then spend $10000 to get it roadworthy when I go to register it I have to pay stamp duty on the market value at the time I register it rather than the value when I acquired it. So I have to pay significantly more stamp duty as a result of spending coutless hours and many thousands of dollars (which also includes GST) on restoring the vehicle. This seems unjust and unreasonable.
“I know you are trying to stop people from getting around having to pay stamp duty on a vehicle that has been acquired for less than its market value. However I feel that stamp duty should be based on the market value at time of acquisition not at time of registration.”
Under Chapter 9 of the Duties Act 1999 (ACT), duty is payable on the application to transfer registration of a motor vehicle or to register a vehicle. Section 204 of the Act states:
204 Imposition of duty
This chapter charges duty on an application to register a motor vehicle under the Vehicle Registration Act if-
(a) the vehicle has not previously been registered under that Act or any other Territory law; or
(b) the person in whose name the vehicle is to be registered is not the person in whose name the vehicle was last registered.
Duty is calculated, according to sections 203 and 208, on the greater of the purchase price or the market value. The Act does not charge duty on the acquisition of a motor vehicle. Rather, duty is imposed when an application is made to register it under the Road Transport (Vehicle Registration) Act 1999.
Duty is levied at the rate of $3.00 for each $100 or part thereof of the purchase price or market value of the vehicle, whichever is greater. For a passenger vehicle with a value over $45,000 the duty payable is $1350 plus $5.00 for each $100 or part thereof in excess of $45,000 of the purchase price or market value of the vehicle, whichever is greater.
If you have any further questions related to this matter please contact the officer listed below and quote the reference number related to your message.
(contact details omitted)