Looking to buy your first home? Well here is everything you need to know about Stamp Duty.
What is Stamp Duty?
Stamp duty (also known as transfer duty) is a tax charged for the registered transfer of property by the regulator. The regulator being the State government, which in Queensland is the Office of State Revenue (OSR).
Stamp duty can apply to various transactions such as buying, selling or transferring property. Essentially, everyone must pay stamp duty unless they meet the requirements to claim for a concession such as the first home purchase.
When must Stamp Duty be paid?
When buying a property, a dutiable transaction arises once you have signed the contract. From there, you will be dealing with the conditions of the contract such as obtaining finance or carrying out your building and pest inspections. Once everything is satisfied and your contract goes unconditional, you will have 30 days from that unconditional date to pay stamp duty (unless you have claimed a concession and the duty is zero).
How much Stamp Duty is paid?
The most common question we receive from a client is how much stamp duty must be paid. This amount is dependent on the purchase price agreed between you and the Seller to purchase the property. The higher the purchase price, the higher the duty.
As mentioned earlier, first home buyers do have the pleasure of claiming a concession if they have never purchased a property before. There are two types of concessions; first home and first home vacant land.
You are eligible to claim for the first home or vacant land concession, if you:
- Have never held an interest in residential land anywhere in the world;
- Are at least 18 years of age;
- Will be living in the property as your principal place of residence; and
- Are buying:
a) A home less than $550,000.00 ($500,000.00 or less for zero stamp duty); or
b) Land less than $400,000.00 ($250,000.00 or less for zero stamp duty).
What if the first home concession cannot be claimed?
If you are purchasing a property that has a purchase price over the threshold to claim for first home concession, then you can only claim ‘home concession’. Again, depending on your purchase price, the stamp duty will be calculated accordingly. Buyers who have owned a home before will also have to claim home concession as first home concession is unavailable to them.
If you are concerned or unsure as to how much stamp duty you will be liable for, please contact the Office of State Revenue for further information.