Stamp duty or, as it is more commonly known in Queensland, transfer duty is a one-off government fee you will be required to pay when you buy land or property. Stamp duty is imposed following the transfer of a title whether it be for residential, commercial, or investment purposes.
The duty is calculated on the market value of the property. The more expensive the asset, the higher the transfer duty rate you’ll have to pay.
Transfer duty rates relevant to property values in Queensland are as follows:
Below $5,000 = $0
More than $5,000 up to $75,000 = $1.50 for each $100, or part of $100, over $5,000
$75,000 to $540,000 = $1,050 plus $3.50 for each $100, or part of $100, over $75,000
$540,000 to $1,000,000 = $17,325 plus $4.50 for each $100, or part of $100, over $540,000
Over $1,000,000 = $38,025 plus $5.75 for each $100, or part of $100, over $1,000,000
For example, if you purchased a house valued at $650,000, falling within the $540,000 - $1,000,000 threshold, you would be taxed $17,325 outright. On top of this, you’d be taxed at a rate of $4.50 for every $100 in $110,000 (the amount over $540,000), to a total of $4,950. Without including any other government fees, you would need to pay $22,275 in transfer duty on that $650,000 property.
Queensland imposes an ‘additional foreign acquirer duty’ (AFAD), at a rate of 7% of the value of the property, to any foreign persons purchasing land or property. So if you were not an Australian citizen, purchasing a $650,000 property, not only would you have to pay the $22,275, you would also be taxed an additional 7%.
In Queensland, transfer duty is payable to the Office of State Revenue. Before you make a payment, you must first lodge all appropriate documents and forms for assessment. These might include a dutiable transaction statement and a claim for a home or first home transfer duty concession. These documents should be lodged within 30 days of you signing them.
The documents may be lodged with either the Queensland Office of State Revenue (OSR), or a registered self assessor, such as a solicitor. You will then be sent a notice of assessment, which will inform you how much duty you’re liable to pay. The method you use to pay is up to you.
As transfer duty is a state and territory government tax, the money paid will go towards funding certain public sectors, such as health, education and training and roads and transport.
Transfer duty is payable once you receive notification that your documents have been assessed. If you’re borrowing money, your lender will likely require you to have these documents stamped before the loan can be settled, so you will need to pay the transfer duty amount before then. The longer you take to pay the duty, the longer it will take for you to be legally recognised as the new owner of the property, and after a certain time additional interest and fees may start to accrue.
Queensland offers a number of stamp duty (transfer duty) concessions. If you are planning to move into the house within the next 12 months and don't sell or lease the property or part of the property, you are eligible for concessions.
The concession transfer duty rates relevant to property values in Queensland are as follows:
Therefore, if you were to purchase a property for $650,000 and claim the home concession, you would only be charged $10,150 outright in transfer duty instead of the standard $17,325. Adding on $4.50 for every $100 over $540,000 (a total of $4,950), with this concession you would only be required to pay $15,100 in transfer duty.
Queensland also offers a ‘first home concession’ to first home buyers over 18 years of age who intend to live in a property as their principal place of residence, and who’ve never previously owned property or land or claimed the vacant land concession. The concession, which is deducted from the home concession amount, may be claimed on properties valued up to $549,999.
There is also a first home vacant land concession that may be claimed on land valued between $250,000 and $399,999. For land valued at less than $250,000, a full exemption from transfer duty may be claimed.
Read more about transfer duty in Queensland here.
Learn more about duty payable in New South Wales here.
For example, if your residential property is valued at $800,000, it would fall within the $300,001 - $1,000,000 threshold. You would incur an outright stamp duty charge of $8,990 and an additional charge of $22,500. This brings you to a total of $31,490 payable in stamp duty.
Who is stamp duty payable to in NSW?
In NSW, stamp duty is payable to the Office of State Revenue. There are several ways you can pay, including by mail and BPay.
Stamp duty is a tax, and therefore the money will go towards the NSW state government budget. The money is put back into the economy, and used to fund public sectors such as health, emergency services, roads and transport, and education and training.
You become liable for stamp duty when the transaction or sale is finalised, and contracts are either exchanged or completed. When purchasing property, with or without a loan, stamp duty must be paid within 3 months after the completion of the transaction. After 3 months, interest will begin to accrue, for which you will also be liable.
If you are purchasing a residential unit off the plan, stamp duty should be paid within 15 months of the contracts being exchanged or completed.
Who is exempt from paying stamp duty in NSW?
First home buyers in NSW are offered concessions and exemptions on stamp duty under the First Home Buyers Assistance scheme. As of July 1, 2017, first home buyers are exempt from stamp duty when purchasing both new and existing homes valued up to $650,000. While concessions are in place for those buying property between $650,000 and $800,000.
If they are purchasing a vacant block of land on which to build a home, first home buyers will pay no stamp duty on land valued up to $350,000, and there are concessions if the land is valued between $350,000 and $450,000.
A number of conditions apply, which you must meet in order to be eligible for these concessions and exemptions. For instance, if you are purchasing property with a partner who has already benefited from the first home buyer scheme, you will not be considered eligible. You must also be a person (not a company or trust), over 18 years of age, have permanent residency in Australia (you or your partner) and occupy the dwelling within 12 months of purchasing it, for a period of at least 6 months.
Exemptions also apply if the property is being transferred due to the owner being deceased or due to the break up of a marriage or other relationship, or if ownership is being transferred between married or de facto couples.