read our blog articles
What Is Stamp Duty?
If you're in the market for a new property, you have probably heard the term stamp duty, also referred to as transfer duty. But what exactly is it, and does it apply to you?
Put simply, stamp duty is a tax imposed when purchasing a house. The amount varies based on the state or territory you want to purchase in and the property's purchase price, with occasional exemptions available. On average, Australians pay tens of thousands of dollars in stamp duty. This expense comes on top of the mortgage, deposit, and other costs associated with buying a property.
What Does Stamp Duty Cost?
Calculating the exact amount of stamp duty involves a few steps. Here are three key factors in determining your potential stamp duty costs:
Which state or territory do you live in?
Stamp duty is determined by the government of each state and territory. Consequently, each one has its own rates, price brackets, and exemptions.
How much is the house you’re buying?
The cost of your property plays a crucial role in calculating stamp duty. Each state and territory have specific price brackets that dictate the amount owed. Once you have determined the stamp duty based on your state or territory, the price of your house will set the rate you pay.
Are you entitled to any exemptions?
Before you potentially hand over tens of thousands of dollars in tax, you might be eligible for a stamp duty exemption. For instance, in some states, first-time home buyers and pensioners may not have to pay any stamp duty on homes up to a certain price. Additionally, even if you don’t qualify for a full exemption, there are often reduced rates available under specific conditions. We recommend checking your state or territory’s exemptions to see if you qualify for a stamp duty concession.
To completely simplify this process, you can use our user-friendly Stamp Duty Calculator to get an estimate of the stamp duty costs, and government fees associated with buying a property. All based on your circumstances and state or territory you are looking to purchase in.
When do I have to pay Stamp Duty?
Stamp duty is typically paid either before or on the day of settlement to ensure that the settlement process proceeds smoothly and without any complications. This timely payment is crucial for finalising the property transaction and avoiding any potential delays.
In most cases, the payment of stamp duty is handled by your solicitor on your behalf. To facilitate this process, your solicitor will pay the required amount directly to the State Revenue Office. This ensures that the transaction is managed efficiently and in compliance with state regulations, allowing you to focus on other aspects of your property purchase.
Stamp duty can be one of the biggest upfront costs of buying property. If you would like to find out more, we are here to help guide you through your home buying journey.
