If you’re purchasing a home, these are two important questions you need to ask yourself. With different rules across Australia, the answers will depend on where you live. Also, the rules in several states have changed, so you will want to keep these in mind when considering payments and how to minimise or avoid them.
Stamp duty NSW
This state has seen the biggest change recently. As a result of The Property Tax (First Home Buyer Choice) Act 2022 – which came into effect in January 2023 – eligible first home buyers can choose between land tax and stamp duty. Under the new legislation, first home buyers who purchase a new or existing home for up to $1.5 million have the option to pay the upfront stamp duty or an annual property tax. If purchasing vacant land to build a first home, the value is up to $800,000 to have a choice.
If you’re purchasing a property up to $650,000, you are still eligible for existing stamp duty concessions and exemptions. For this reason, it’s probably better to choose stamp duty.
The big question for first home buyers purchasing a property between $650,000 to $1.5 million, you’ll want to know what’s the better deal. You’ll need to compare the estimated land tax and stamp duty to decide.
The annual land tax is based on the land value of the property. In 2022 – 2023, the rates are $400 plus 0.3% of the land value for owner-occupied properties and $1,500 plus 1.1% of the land value for investment properties.
Stamp duty is a bit more complicated and is based on a range of property values. For example, if the property value is between $327,000 and $1,089,000 the stamp duty will be $9,805 plus $4.50 for every $100 over $327,000.
Stamp duty Victoria
Home buyers in Victoria don’t get a choice as available in New South Wales but there are stamp duty exemptions or concessions. These may be available for first home buyers, people purchasing a home as a principal place of residence, pensioners and people purchasing off the plan. If purchasing a property with a dutiable value of $600,000 or less, you can receive an exemption in Victoria. If purchasing a property with a dutiable value from $600,001 to $750,000, you can receive a concession based on a sliding scale.
Stamp duty QLD
In Queensland, it’s called transfer duty. Like Victoria, it’s based on property value ranges. For example, for a property with a dutiable value between $540,001 and $1,000,000 the transfer duty will be $17,325 plus $4.50 for each $100, or part of $100, over $540,000.
Also, there are exemptions and concessions for transfer duties in Queensland. There’s a first home concession for first home buyers and a home concession if you move into the home with your personal belongings and live in it on a daily basis within one year of settlement and do not sell, transfer, lease or otherwise grant exclusive possession of all or part of the property before you move in.
Stamp duty SA
As with other states, South Australia charges stamp duty based on a table of values. For example, if the property exceeds $500,000, you’ll pay $21,330 plus $5.50 for every $100 over $500,000. Unlike New South Wales and Victoria, there are no exemptions of concessions for first home buyers.
Stamp duty WA
In Western Australia, the stamp duty is also based on the value of the property with a range of values determining what you’ll pay. For instance, for a home with a purchase price of more than $500,000, the stamp duty will be $19,665 plus $5.15 per $100 above $500,000. Western Australia offers concessions for first homeowners and homes that are principal places of residence.
Stamp duty TAS
In Tasmania, the stamp duty is based on the dutiable value of the property based on value ranges. For example, for a property between $375,001 and $725,000, the stamp duty will be $12,935 plus $4.25 for every $100 over $375,000. Unfortunately, there are no exemptions for first home buyers in Tasmania.
Stamp duty NT
The Northern Territory charges stamp duty based on the value as well but has fewer ranges and a simpler method of calculation. For instance, for property valued between $525,001 to $3,000,000, the stamp duty is 4.95% of the value. There are concessions including the Principal Place of Concession (PPR) which is available to all home buyers purchasing a new home or land to build a home. Homes that are substantially renovated may also be considered new for the PPR concession.
Stamp duty calculator
If you’re not sure about the stamp duty payable, you don’t need to punch the numbers in your calculator. Simply try our handy stamp duty calculator that allows you to choose your state or territory to find out what you might need to pay.
Getting help with your home loan
Besides the fees and charges of purchasing a home, you’ll need to consider the options among home loans. If you’re not sure about the finance options and process, the experts at Reduce Home Loans are ready to help.
Contact Reduce Home Loans for a better home loan experience and a great rate.
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