This discussion relates to the stamp duty requirements in
New South Wales for the purchase of residential property. Each State will have its own particular rules.
Our Article covers the major general stamp duty effects for
residential property. However, you should contact the
Office of State Revenue to confirm stamp duty liability for
your particular situation.
A. The transfer of ownership of the property – payable by the Buyer.
In New South Wales, you will need to pay stamp duty within 3
months from the date of your exchange of Contracts. If
the duty is not paid within three months of "first
execution" a penalty arises under the Taxation
Administration Act 1996. Interest becomes payable on
the unpaid tax on a daily basis.
B. Any finance that the Buyer arranges for the purchase – also payable by the Buyer
The amount you pay depends on your particular circumstances.
If you are a FIRST homebuyer you may be entitled to a
significant concession. If you are buying a property
over $3M and the Contract is dated ON OR AFTER 01 June 2004,
you will pay a higher stamp duty rate. Click on our
Stamp Duty Calculator below.
In some circumstances, you as Buyer may be eligible under the First Home Plus Scheme which provides exemptions and concessions on stamp duty and mortgage duty to first home or land purchasers under contracts signed
ON OR AFTER
01 July
2004. There is no income or assets test, but there are restrictions on eligibility, as follows:
You will occupy the property as your principal place of residence on
or before completion or within 12 months after completion for a
continuous period of six (6) months.
All Buyers must be individuals. Companies and Trusts cannot
claim any concession or exemption.
All Buyers must be FIRST property buyers
- if one Buyer has owned a property before (residential or commercial)
in Australia, then all Buyers are knocked out.
Exception: If one or more of the Buyers are only buying
to assist another Buyer to obtain finance then you can make a
submission to the OSR to get the First Home Owner concessional rate.
Example: Bank will not lend enough to Daughter.
Father and Mother go on title and sign up as co-mortgagors so Bank
will advance the money.
All Buyers must be 18 years old or more.
At least one Buyer must be an Australian
citizen/permanent resident.
If any of the Buyers are married or in a
de facto relationship, and their spouse has owned a property before,
the all Buyers are ineligible.
The
new concession rate changes based on price, but is no
longer dependent on the location of the property, as well as whether it is house and land or just land.
Click on the Stamp Duty Calculator above to calculate your concession.
B. Stamp Duty on Finance raised to Purchase
This stamp duty is levied on monies that you borrow to finance your property
acquisition (mortgage duty).
While this sounds expensive, the stamp duty for financing is
much less than the stamp duty for the transfer discussed above. The
amount payable is set out below:
1. Borrowing the monies to finance a residential
property non-concessional
The amount of duty is:
$5.00, for mortgages of up to
$16,000 or
for advances over $16,000 - $5.00, plus a further $4.00 for every $1,000, or part, over $16,000
The amount of duty
chargeable on a mortgage in respect of an advance or further advance is $4.00 for every $1,000, or part, of the amount secured. Concessional rates may apply to refinances, so be sure to ask your financier for the appropriate concession form to see if it applies to your situation.
2. Borrowing the monies to finance a First Home
(Concessional
rate)
The percentage of mortgage duty discount depends on the purchase price of the property. See the table below for examples of
these percentage discounts based on different purchase prices:
