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Criteria Applicable to the Farm Transfer Transaction
Transfer must be a gift
VEA ?
The transfer of the relevant farming assets must have occurred by way of gift.
Example of a farm transfer that is not considered to be a gift
If the farmer signs a contract to sell the farm(s) to the younger generation, with the price to be paid by instalments, the amount of the unpaid instalments is not an asset that can be disregarded under RAFS.
Transfer must include real property
The assets transferred, as a gift must have included real property (land).
Transfer of legal title required
The farmer must have transferred the legal title of their farm land to the eligible descendant.
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Transfer under general law system
Ownership of land under general law can only be proven by the 'chain of title', the group of documents that show changes in ownership for at least the last 30 years.
Where the farmer holds general law land, this land must have been converted to a Torrens title before the transfer of legal title was accepted for RAFS purposes.
Transfer under Torrens system
A farmer's ownership of land under the Torrens system can be shown on a certificate of title issued under the relevant State land law.
Verification of transfer of title
To confirm the transfer by the farmer to the younger generation, a copy of the certificate of title of the relevant farm land was required by the Department.
Acceptable proof of ownership, and thus transfer, differed depending on whether the title for the land was held under the general law (old) system or the Torrens system.
Section 49A(1) VEA - Requirement for qualifying farmer
Section 49A(2) VEA - Requirement for former partner
Transferring legal title of the farm
According to subsection 5P(1) of the VEA, a relevant farm asset in relation to a farm, means any livestock, crop, plant or equipment that is a produce of, or is used for the purposes of, the farm enterprise.
According to subsection 5P(1) of the VEA, an eligible descendant in relation to a person means:
- a child, step child or adopted child of the person or of a partner of the person, or
- a descendant in direct line of a child described above, or
- any other person who, in the opinion of the [glossary:Commission:DEF/Commission/Repatriation Commission], should be treated for the purposes of this definition as a person described in the above paragraph.
According to subsection 5P(1) of the VEA, relevant State land law means any of the following laws:
- The Real Property Act 1900 of New South Wales;
- The Transfer of Land Act 1958 of Victoria;
- The Land Title Act 1994 of Queensland;
- The Transfer of Land Act 1893 of Western Australia;
- The Real Property Act 1886 of South Australia;
- The Land Titles Act 1980 of Tasmania;
- The Real Property Act 1925 of the Australian Capital Territory;
- The Real Property Act of the Northern Territory;
- A law of a Territory (other than the Australian Capital Territory or the Nothern Territory) making similar provision for the registration of dealings with land as the laws mentioned above.