Stamp Duty Australia: The Definitive Guide For 2023
For most Australian expats living overseas who want to buy property back home, paying stamp duty in Australia is an unavoidable step in property ownership. It is arguably the single most expensive cost you’ll have to pay in acquiring a property, whether a house, vacant land or an apartment.
What Exactly is Stamp Duty in Australia?
Stamp duty is a tax charged by the Australian states and territory governments on certain documents and transactions – the main one being property transactions.
The states collect the tax and spend it on infrastructure, public facilities, and healthcare, amongst other things.
Stamp Duty Australia: How Much Do You Need to Pay?
The stamp duty cost for most properties typically ranges between:
- 2-3% for properties valued under $500,000
- 3-4% for properties valued at $500,000 to $1 million
- 4-7% for properties over $1 million
For example, if your property purchase price is $1,000,000, then the Australia stamp duty payable is approximately $30,000–40,000.
How Much is Stamp Duty in Australia? Does it Vary by State and Territory?
Stamp duty is calculated based on three core variables:
- The property purchase price
- Location, such as New South Wales
- Intended purpose, e.g. Primary residence or investment
Stamp duty calculation methods vary between states due to their unique variables and tax structures. Certain states have higher stamp duty rates and no exemptions, while others offer no stamp duty for properties below a specific value.
For more information, please refer to the stamp duty calculator and guide for the following states:
Try our Australian Stamp Duty Calculator!
- First Home Buyer means that it’s the first time you bought a home in which you will be living for at least six months of the first 12 months of ownership. For an Australian expat, this is usually always ‘No’.
- Foreign Purchaser means that you are not an Australian citizen or Australian Permanent Resident. If you are an Australian expat, you are not a Foreigner Purchaser.
- Transfer fee is a state government fee for updating the land’s ownership title records to your name.
- The mortgage fee is another government fee for registering your mortgage and the lender as mortgagee on your property.
Take the first step towards the right home loan.
Apply online to get expert recommendations with real interest rates and repayments.
When Do You Have to Pay the Stamp Duty in Australia?
Your stamp duty deadline will vary from State to State. Your appointed conveyancer, solicitor or settlement agent will advise you and assist with paying the stamp duty to the State’s Revenue Office (SRO).
If you are obtaining a mortgage, the solicitors usually pay the stamp duty on the day of settlement. Use the funds available at settlement from the loan proceeds or your contributions.
The Australian Property Stamp Duty Deadlines for Different States
| State | Deadline |
|---|---|
| NSW | Stamp Duty is to be paid to the SRO within 90 days of settlement. If purchasing off-the-plan, Stamp Duty is payable within 90 days of signed contract date. |
| VIC | Stamp Duty is to be paid to the SRO within 30 days of settlement. |
| QLD | Stamp Duty is to be paid to the SRO within 30 days of settlement. |
| WA | Stamp Duty is to be paid to the SRO within 30 days of receiving the Duties Assessment Notice. To receive the Assessment Notice you’ll first have to lodge your Transfer documents to the SRO within 60 days of the settlement. |
| NT | Stamp Duty is to be paid to the SRO within 60 days of entering into a transaction or settlement, whichever is earlier. |
| SA | Stamp Duty is to be paid to the SRO on the day of settlement. |
| TAS | Stamp Duty is to be paid to the SRO within 90 days of settlement. |
| ACT | Stamp Duty is to be paid to the SRO within 14 days of receiving the Notice of Assessment. To receive the Assessment Notice you’ll first have to lodge your Transfer documents to the SRO within 14 days of the settlement. |
Do You Need to Pay Foreign Buyer Property Stamp Duty Surcharge in Australia?
In the last few years, the Australian state governments have imposed additional stamp duty of up to 8% for anyone who is a foreign buyer. This surcharge gets added on top of the standard stamp duty.
This surcharge applies to foreign buyers acquiring or investing in residential properties in Victoria (VIC), New South Wales (NSW), Queensland (QLD), South Australia (SA), and Western Australia (WA). Aside from the standard stamp duty levy, some states also impose a land tax surcharge on foreign property owners.
There is currently no Foreign Buyers’ Stamp Duty Surcharge in the Northern Territory and the ACT. In NSW and VIC, it’s 8%. For the rest of the states, it is 7%.
Stamp duty surcharge is common practice amongst other developed countries to help curb the strong demand for foreign investment into residential properties, control housing affordability, and generate extra tax revenue.
Countries such as Hong Kong, Singapore and Canada have implemented similar measures with comparatively harsher fees, as high as 20% additional Australian property stamp duty on top of the standard fee!
Foreign Buyers' Stamp Duty Can Be an Unexpected Shock
Here are two scenarios where the foreign buyers’ stamp duty in Australia applies:
- A foreign national buys a $1,250,000 property in NSW, equating to a standard stamp duty of $54,052 plus an Australian stamp duty for foreign buyers of $100,000 for a total of $154,052.
- An Australian citizen buys a $1,250,000 property in NSW with a foreign spouse, jointly owned 50/50. This would equate to a standard stamp duty of $54,052 plus a foreign buyers’ duty of $50,000 for a total of $104,052.
The alternative is to purchase in the Australian spouse’s name and only have to pay the standard stamp duty of $54,052.
In some cases, you’ll still be able to have your foreign national spouse on the Home loan application if you need to show more income to increase your borrowing capacity. They won’t appear on the title of the property.
How to Reduce or Avoid Paying Stamp Duty Altogether
In some circumstances, you may be able to get a concession or exemption from paying stamp duty tax in Australia.
If you are residing overseas, it’s highly unlikely you’ll be eligible for the First Home Owners stamp duty concessions, as you’ll need to live in the property for at least six months of the first year of ownership.
But fret not. You can purchase multiple investment properties in Australia while overseas and still be eligible for the first homeowner benefits once you return to Australia.
Stamp Duty Tax Concessions and Exemptions in Australian States
New South Wales (NSW)
First-time homeowners purchasing primary residence (new homes only):
- Purchase price <=$800,000 = Stamp duty exempt
- Purchase price $800,001–999,999 = Stamp duty concession
- Purchase price $1 million+ = No concession
———————————————
First-time homeowners purchasing primary residence (established):
- Purchase price <=$650,000 = Stamp duty exempt
- Purchase price $650,001–799,999 = Stamp duty concession
- Purchase price $800k+ = No concession
———————————————
First-time homeowners purchasing vacant land (to build on later):
- Purchase price <=$400,000 = Stamp duty exempt
- Purchase price $400,001–499,999 = Stamp duty concession
- Purchase price $500k+ = No concession
Victoria (VIC)
First-time homeowners purchasing primary residence:
- Purchase price <=$600,000 = Stamp duty exempt
- Purchase price $600,001–749,999 = Stamp duty concession
- Purchase price $750k+ = No concession
Pensioners, farmers, and people purchasing from a plan are also eligible for Stamp duty concessions or exemptions to varying degrees.
Queensland (QLD)
First-time homeowners purchasing primary residence:
- Purchase price <=$500,000 = Stamp duty exempt
- Purchase price $500,001–549,999 = Stamp duty concession
- Purchase price $550k+ = No concession
———————————————
First-time homeowners purchasing vacant land (to build on later):
- Purchase price <=$250,000 = Stamp duty exempt
- Purchase price $250,001–399,000 = Stamp duty concession
- Purchase price $400k+ = No concession
Western Australia (WA)
First-time homeowners purchasing primary residence:
- Purchase price <$430,000 = Stamp duty exempt
- Purchase price $430,000-530,000 = Stamp duty concession
- Purchase price >$530,000 = No concession
———————————————
First-time homeowners purchasing vacant land (to build on later):
- Purchase price <=$300,000 = Stamp duty exempt
- Purchase price $300,001-399,000 = Stamp duty concession
- Purchase price $400k+ = No concession
Currently, there is a 75% stamp duty discount for anyone purchasing off-the-plan (pre-construction) until 23 October 2021. Other types of exemptions apply to family farm transactions between family members.
Northern Territory (NT)
First-time homeowners purchasing a primary residence:
- Purchase price $430,000-650,000 = $18,601 discount
- Purchase price >$650,000 = no concession
There are also exemptions and discounts for seniors, pensioners or carers.
South Australia (SA)
There are no Stamp Duty exemptions of concessions.
South Australia currently has the highest Stamp Duty of any State.
Tasmania (TAS)
Exemptions are available for first-home buyers and pensioners.
First-home buyers and Pensioners in Tasmania can receive a 50% concession on stamp duty when purchasing a property valued up to $400,000 until 30 June 2020.
Stamp duty exemption is also applicable for married couples transferring primary residence property from a sole name into a joint name.
Australian Capital Territory (ACT)
The ACT offers the Home Buyer Concession Scheme for buyers buying new properties, established properties or vacant blocks of land (from 1 July 2019).
- Purchase price up to $500,000 = Stamp duty exempt
- Purchase price $500,000-600,000 = Stamp duty concession
- Purchase price up to $710,000 = Stamp duty concession for non-first home buyers
- Purchase price up to $750,000 = Stamp duty concession for pensioner concession card holders
- Transferring a home between married/de facto partners or into joint names = Stamp duty exemption
There are several conditions to qualify:
- Applicants must be over 18 years old, must not have owned a home in the past 2 years, intend to live in the property for at least 12 months and have a household income under the threshold.
- Applicants can not have held an interest in any land in the last two years.
- Applicants need to live in the property for at least one year after buying it.
- Applicants need to have an income that is lower than the threshold. The income threshold is currently $160,000 for singles with no dependents, $163,330 for couples/singles with 1 dependent child, and $166,660 for couples/singles with 2 or more dependent children.
Other Stamp Duty on Property Exemption Scenarios
In cases of divorce mandated by Court Order, stamp duty will be waived when transferring properties to the other party.
If a family member passed away, and in their Will, it’s stated the properties are to be passed down to you, then stamp duty will also be waived.
How to Borrow the Entire Australian Stamp Duty in Your Mortgage
In most cases, the banks will only lend you up to 80% of your property’s value, which means you’ll still need to come up with the remaining 20% deposit yourself, plus the 4-5% stamp duty rate, so the total contribution required is approximately 25%.
Using an example of a $1,000,000 property, you’ll need $250,000 for your contribution.
So how can you come up with that $250,000?
Method 1 - Releasing Equity (Top-up/Cash Out) from an Existing Property to Pay the Stamp Duty Tax
If you have an existing Australian property, you can offer that property as additional security, and the bank will allow you to borrow up to 80% of its value.
For example:
- You have an existing property worth $500,000 with a current loan balance of $150,000.
- The bank will allow you to borrow up to 80% of the value, so a maximum potential loan of $400,000.
- You top up your loan from $150,000 to $400,000, a $250,000 cash out or equity which you then take and pay for the remainder of the first purchase, effectively borrowing the entire amount of the purchase and the stamp duty.
Method 2 - Family Guarantor Home Loan to Help Pay the Stamp Duty Rate
This method doesn’t require you to have any existing properties, but it does rely on your parents being willing and able to offer their property as additional security for your loan. Assuming there’s sufficient equity available in their property, the bank may then allow you to borrow up to 80% of its value.
Method 3 - Lender's Mortgage Insurance (LMI) to Support the Australian Stamp Duty Charge
You can borrow up to 90% of the property’s value by paying Lenders Mortgage Insurance (LMI) to the bank. If you borrow 80% or lower, there is typically no LMI fee payable.
If you borrow 90%, the LMI fee would be approximately 2-3% of the property value and gets added on top of the loan amount. For the $1,000,000 purchase, you could borrow $900,000 by adding a $20,000-30,000 LMI fee on top of your loan. Your total loan amount would be $920,000-930,000.
Paying LMI is only something we’d recommend if you can’t do the first two methods, you need more savings/deposit, or you want to enter the property market sooner rather than later.
Prepare Financially for Stamp Duty Costs in Australia
Lack of foresight into the cost of stamp duty can derail your property-buying journey and sometimes give you a nasty surprise after signing an unconditional purchase contract, especially if there’s a foreign citizen involved.
That said, the hefty tax bill is mostly unavoidable. To ease the pain, look at it as your tax-deductible donation to the State government in its efforts to make Australia a more desirable place to live!
Speak with one of our tax specialists to find out how you can prepare for and save on Australian property stamp duty.
Contact the State Revenue Office
| State | Revenue Office Contact |
|---|---|
| NSW | www.osr.nsw.gov.au |
| VIC | www.sro.vic.gov.au |
| QLD | www.osr.qld.gov.au |
| WA | www.osr.wa.gov.au |
| NT | www.treasury.nt.gov.au |
| SA | www.revenuesa.sa.gov.au |
| TAS | www.sro.tas.gov.au |
| ACT | www.revenue.act.gov.au |
Take the first step towards the right home loan.
Apply online to get expert recommendations with real interest rates and repayments.
Frequently Asked Questions
What are stamp duty rates?
Stamp duty rates are taxes levied on the purchase of property in Australia. These rates vary by state and territory, and they typically apply to residential properties valued over a certain threshold. The amount of stamp duty payable is calculated as a percentage of the property’s purchase price.
What are the factors that determine how much Australian stamp duty is to be paid?
The key factors that determine stamp duty are the purchase price of the property, the location of the property (which state/territory), and the buyer’s status (such as first home buyer, foreign buyer etc.). Rates vary between states and territories and are not uniform across Australia. Within a state, the stamp duty rate rises progressively based on the property purchase price.
Other factors like property type and buyer eligibility for concessions also impact the amount payable.
How is stamp duty in Australia calculated?
Stamp duty is calculated as a percentage of the purchase price, with the exact percentage determined based on the state/territory and property value. Most states have stamp duty ‘brackets’ where the rate increases once the property value hits a certain threshold.
The residency status of the buyer (Australian citizen, foreigner etc.) can also affect the rate. Use an online stamp duty calculator or consult an accountant to determine the amount payable on a property.
Does Australian stamp duty cost the same across all states and territories?
No, stamp duty rates vary widely across different Australian states and territories. Each state has its own thresholds and progressive stamp duty rates based on factors like property value, buyer status, location etc. It’s important to check the specific stamp duty rules and rates applicable in the state where you are buying the property.
Are there any exemptions or concessions available for stamp duty in Australia?
Yes, certain buyers, like first homeowners, may be eligible for exemptions or discounts on stamp duty in some states. Senior citizens, pensioners, etc., may also qualify for concessions in certain cases. Eligibility criteria can vary across states, so check individual state revenue office websites for the most current details.
When should the stamp duty be paid?
Stamp duty is due at settlement – when a property officially changes ownership. For properties bought with a mortgage, it is common for stamp duty to be paid on your behalf by your lender or conveyancer out of the loan amount on the day of settlement.
Do you need to pay Foreign Buyer Stamp Duty Surcharge?
In some states, yes – foreign buyers are subject to a stamp duty surcharge ranging from 7-8% on top of standard stamp duty rates. However, if you are an Australian citizen or permanent resident purchasing locally, you are exempt even if living overseas. Check if the surcharge applies in your state.
Will Australian expats living in Singapore have to pay stamp duty?
Australian expats living in Singapore may need to pay stamp duty when buying property back home in Australia, depending on the state or territory you are buying in.
In New South Wales, Victoria, Queensland, Western Australia, South Australia and Tasmania, Australian expats are exempt from paying stamp duty on their first home purchase. However, they will still need to pay stamp duty on any subsequent property purchases.
In the Northern Territory and the Australian Capital Territory, there is no stamp duty on property purchases.
In the ACT, there is a surcharge of 7% for foreign buyers, but this does not apply to Australian citizens who are living overseas.
It is important to note that these are just general guidelines and the specific stamp duty requirements may vary depending on the state or territory, and the type of property being purchased. It is always best to consult with a property lawyer or conveyancer to get the most accurate information.
Here are some additional things to keep in mind:
- If you are buying a property in Australia with a mortgage, your lender may require you to pay stamp duty upfront.
- You may be able to claim a stamp duty exemption if you are buying a property for your principal place of residence.
- There are also some exemptions for first home buyers and low-income earners.
It is important to do your research and understand the stamp duty requirements in the state or territory where you are buying property. This will help you avoid any unexpected costs.
Will Australian Expats lving in Hong Kong have to pay stamp duty?
Australian expatriates residing in Hong Kong might be liable for stamp duty when purchasing property in Australia, contingent upon the specific state or territory where the acquisition occurs.
In New South Wales, Victoria, Queensland, Western Australia, South Australia, and Tasmania, Australian expats are excused from paying stamp duty on their initial home purchase but are still obligated to pay it for subsequent property acquisitions.
In the Northern Territory and the Australian Capital Territory, there are no stamp duty charges for property acquisitions.
In the Australian Capital Territory, a 7% surcharge is applied to foreign buyers, but Australian citizens living abroad are exempt from this surcharge.
It’s essential to recognise that these are general guidelines, and the precise stamp duty requisites may fluctuate according to the state, territory, and property type involved. Consulting a property attorney or conveyancer is advisable for obtaining accurate information.
Here are some additional considerations:
- If you’re acquiring Australian property with a mortgage, your lender may require upfront payment of stamp duty.
- You may be eligible for a stamp duty exemption when purchasing property for your primary residence.
- First-time homebuyers and individuals with low incomes may qualify for certain exemptions.
Thorough research into the specific stamp duty requirements in the state or territory where you intend to purchase property is crucial to avoid unforeseen expenses.
Will Australian expats living in the UAE have to pay stamp duty?
Australian expatriates residing in the UAE may find themselves subject to stamp duty when acquiring property in Australia, depending on the particular state or territory where the purchase takes place.
In New South Wales, Victoria, Queensland, Western Australia, South Australia, and Tasmania, Australian expats are exempt from paying stamp duty for their initial home purchase but remain responsible for it in subsequent property transactions.
In the Northern Territory and the Australian Capital Territory, there are no stamp duty obligations for property acquisitions.
In the Australian Capital Territory, a 7% surcharge is imposed on foreign buyers, but Australian citizens living abroad are exempt from this surcharge.
It’s crucial to understand that these are general guidelines, and the exact stamp duty requirements can vary based on the state, territory, and property type in question. Seeking advice from a property lawyer or conveyancer is recommended for obtaining precise and up-to-date information.
Additional considerations include:
If you’re buying Australian property with a mortgage, your lender may require you to pay stamp duty upfront.
You may qualify for a stamp duty exemption when purchasing property as your primary residence.
There are exemptions available for first-time homebuyers and individuals with low incomes.
Conducting thorough research into the specific stamp duty regulations of the state or territory where you plan to buy property is essential to prevent unexpected financial burdens.
How does Australia's foreign stamp duty compare to other countries?
Australia’s foreign stamp duty surcharge of 8% is relatively moderate compared to the 20% duty imposed on foreign buyers in Singapore and Vancouver. This, coupled with the increasing availability of non-bank lending options for foreign investors, has rekindled Australia’s appeal as a destination for real estate investments.
Stamp duty vs. Transfer duty: Are they the same?
Stamp duty and transfer duty are the same thing. They are both terms used to refer to a tax that is levied on the transfer of property. The term “transfer duty” is the more common term used in Australia, while the term “stamp duty” is more common in other countries.
Do first time buyers pay stamp duty?
Whether or not first-time home buyers pay stamp duty depends on the state or territory in Australia where they are buying the property. Some states offer exemptions or concessions for first-time home buyers, while others do not.
Which states offer first-time home buyer stamp duty exemptions?
The following states in Australia offer first-time home buyer stamp duty exemptions:
- New South Wales
- Queensland
- South Australia
- Western Australia
- Northern Territory
- Australian Capital Territory
Do I have to pay stamp duty for rental property?
Yes, you are required to pay stamp duty if you are buying a rental property in Australia. The specific rates and eligibility criteria for stamp duty concessions may vary depending on the state or territory where you are purchasing the property.
Who pays stamp duty in Australia, buyer or seller?
In Australia, stamp duty is generally paid by the buyer of a property, not the seller. This means that the buyer is responsible for paying a tax to the state or territory government based on the purchase price of the property.
