Understanding stamp duty in Victoria

Stamp duty, also known as land transfer duty, is a tax imposed by the Victorian government when you buy property in Victoria, Australia. The amount you pay depends on several factors including the property’s value, the type of property, and any concessions or exemptions you may be eligible for.

Key Aspects of Stamp Duty in Victoria

1. Calculation:
   • Stamp duty is calculated as a percentage of the purchase price or market value of the property, whichever is higher.
   • The rates are tiered, meaning the percentage increases as the property value increases. For example, properties valued between $130,001 and $960,000 are subject to a rate of 6%.
2. Concessions and Exemptions:
   • First Home Buyer Concession: First-time buyers purchasing a home valued between $600,000 and $750,000 may qualify for a concessional rate of stamp duty.
   • First Home Owner Grant (FHOG): If you’re purchasing a new home, you may also qualify for the First Home Owner Grant, which could be up to $10,000.
   • Off-the-Plan Concession: This applies if you’re buying a property off-the-plan (before it’s built), as the duty is based on the property’s value at the time of contract signing, which is often lower.
   • Principal Place of Residence (PPR) Concession: You can receive a concession if the property will be your primary place of residence.
3. Foreign Buyers:
   • Additional duties apply to foreign purchasers. Currently, foreign buyers must pay an additional duty of 8% of the property’s market value.
4. Stamp Duty Waivers and Discounts:
   • At times, the government may introduce temporary waivers or discounts on stamp duty to stimulate the property market. For example, in the past, certain concessions have been offered to buyers of newly built homes.

How to Pay Stamp Duty

Stamp duty must be paid within 30 days of settlement. The State Revenue Office (SRO) of Victoria is responsible for the collection of stamp duty. Typically, your conveyancer or solicitor will calculate and arrange payment as part of the settlement process.

Tools for Calculation

You can use the SRO Victoria’s Stamp Duty Calculator to estimate how much you will need to pay based on your specific circumstances. This is helpful for budgeting when planning a property purchase.

Would you like to know about any specific concessions, exemptions, or recent changes to stamp duty in Victoria?

At Crest Property Investments we specialise in sourcing brand new and off the plan properties for buyers. We also do not charge fees to buyers! If you’d like to learn more, please feel free to contact us. We welcome the opportunity to help you make the best property decision.

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While we have taken care to ensure the information above is true and correct at the time of publication, changes in circumstances and legislation after the displayed date may impact the accuracy of this article. If you want to learn more please contact us. We welcome the opportunity to assist you.

September 2024