The VCAT ruling of Baullo v Commissioner of State Revenue [2023] VCAT 1164 (Baullo), has reaffirmed the position of the State Revenue Office (SRO) that forgiving beneficiary loans in relation to a distribution of property from a discretionary trust to a beneficiary will prohibit utilisation of the exemption to land transfer (stamp) duty afforded by section 36A of the Duties Act 2000 (Act).

Ordinarily, land transfer duty (stamp duty) is paid by the transferee at the time of the transfer of dutiable property, such as real property, unless an exemption to stamp duty is applicable.