NSW Stamp duty exemption explained

NSW Stamp duty exemption for small business insurance

The NSW Government has introduced legislation to make insurance more affordable for small businesses by removing duty from certain insurance products.

From 1 January 2018, small businesses (generally with under $2 million in turnover) are not required to pay duty on certain types of insurance if they declare their business is eligible for the exemption.

You are a small business for the current year if:

  • you carry on a business in the current year; and
  • one or both of the following applies:
    1. you carried on a business in the previous year and your aggregated turnover for that previous year was less than $2 million
    2. your aggregated turnover for the current year is likely to be less than $2 million.

Eligibility for a stamp duty exemption

The NSW Government requires small businesses that are eligible for an exemption to complete a written declaration confirming they meet the exemption criteria.

When you take out a new eligible business insurance policy with us, we’ll apply the exemption once we receive your written declaration.

If you're an existing customer, you'll need to declare your eligibility prior to the renewal of your policy by calling us on 133 233.

In addition, from 1 January 2018, farmers and growers are no longer required to pay duty on crop and livestock insurance. This will be automatically applied for eligible customers, and does not require a declaration.

Call us on 133 233 to declare your exemption.

For more information, see the Frequently Asked Questions, or visit the NSW Government website.

Frequently Asked Questions for NSW insurance stamp duty exemptions

The NSW Government has introduced legislation to make insurance more affordable for small businesses by removing duty from certain insurance products.

From 1 January 2018, small businesses (generally with under $2million in turn over) are not required to pay duty on certain types of insurance if they declare their business is eligible for the exemption.

The NSW insurance duty is a tax on insurance premiums.  Duty is collected by the insurer when you pay your first premium and when your policy renews.

The amount of duty payable depends on the type of insurance, and ranges between 2.5% and 9% of your insurance premium.  You can find out more about the NSW insurance duty on the NSW Government website.

The duty exemption applies to the following types of insurance for small businesses:

  • Commercial vehicle insurance (for a motor vehicle used primarily for business purposes)
  • Occupational indemnity insurance
  • Product and public liability insurance

Small businesses which meet the eligibility requirements set out by the NSW Government are eligible. 

You are generally considered a small business for the current year if you carry on a business in the current year; and one or both of the following applies:

  • you carried on a business in the previous year and your aggregated turnover for that previous year was less than $2million;
  • your aggregated turnover for the current year is likely to be less than $2million.

For more information, visit the NSW Government website.

The NSW Government requires small businesses who are eligible for a duty exemption to complete a written declaration confirming they meet the exemption criteria.

When you take out a new business insurance policy with us, we'll apply the exemption once we receive your written declaration.

If you're an existing customer, you'll need to call us on 133 233 to declare your eligibility prior to the renewal of your policy.

Yes

No. To be eligible for the small business duty exemption, the NSW Government requires you to complete a written declaration stating your business is eligible for the exemption.  To complete a written declaration click here. 

It’s important you declare if your business is eligible before your insurance cover period starts.  Unfortunately, we are unable to backdate exemptions if you declare your eligibility after the start date of your cover.  We can only apply an exemption after your cover has started by cancelling your current policy and taking out a new one. 

If your policy renewal date falls before 1 January 2018, the current insurance duty will still apply.

Yes, you will need to pay the duty. You are only exempt from duty for policies with an effective date of 1 January 2018 onwards.

Yes. You will be eligible for a duty exemption on any policy that starts from 1 January 2018 and onwards.  If you are currently paying by instalments, you will be eligible the duty exemption at your policy’s next renewal. 

Yes, penalties apply if you make a false declaration.  It is important that you ensure your small business is eligible for an exemption before completing the declaration.  For more information about false declarations, please visit the NSW Government website.

You can visit the NSW Government website to find out more information about the state budget changes how they will affect your insurance duty.