Stamp duty, or transfer duty as it is known in Western Australia, is a government tax payable when you buy land or property, or have ownership of land or property transferred to you.
In WA, stamp duty is calculated on the market value of the property. Therefore, the more expensive the asset, the higher the transfer duty rate you’ll have to pay.
There are 2 main types of duty rates in WA, general and residential, and it is important to know the differences between them.
Residential rates apply to places of permanent residence, rental properties, mixed use property (which might have a blend residential and commercial purposes, for example) and vacant land upon which a residential property is constructed, within 5 years from when the owner became liable for duty.
Residential rates relevant to property in WA are as follows:
$0 - $120,000 = $1.90 per $100 or part thereof
$120,001 - $150,000 = $2,280 + $2.85 per $100 or part thereof above $120,000
$150,001 - $360,000 = $3,135 + $3.80 per $100 or part thereof above $150,000
$360,001 - $725,000 = $11,115 + $4.75 per $100 or part thereof above $360,000
$725,001 + = $28,453 + $5.15 per $100 or part thereof above $725,000
For example, if you purchased a property valued at $200,000, you would be required to pay a fee of $3,135 outright. You would then need to pay an additional $1,900 ($3.80 for each $100 above $150,000), to a grand total of $5,035.
General rates apply to commercial property (property intended to generate profit), rural property not used as residential property, and vacant land that is ineligible for the residential rate.
General rates relevant to property values in WA are as follows:
$0 - $80,000 = $1.90 per $100 or part thereof
$80,001 - $100,000 = $1,520 + $2.85 per $100 or part thereof above $80,000
$100,001 - $250,000 = $2,090 + $3.80 per $100 or part thereof above $100,000
$250,001 - $500,000 = $7,790 + $4.75 per $100 or part thereof above $250,000
$500,001 + = $19,665 + $5.15 per $100 or part thereof above $500,000
For example, if you purchased a commercial property valued at $200,000, you would need to pay $2,090, plus an additional $1,990 ($3.80 for each $100 above $50,000). This would bring you to a total of $4,080 in transfer duty.
The Department of Finance is responsible for transfer duty in Western Australia. Forms may be lodged in person or by post with the Commissioner, or through the Revenue Online application (eligible, self-assessing agents only, e.g. solicitors). These documents should be lodged within 2 months of becoming liable to pay the duty.
As transfer duty is a state and territory government tax, the money goes into the state budget, to be used to fund such public sectors as health, police, justice and emergency services, and roads and transport.
Once your documents have been lodged and reviewed, you will receive a Duties Assessment Notice. Transfer duty is typically payable within a month of this date. Payments may be made by credit card, using BPay (telephone or online), or by money order or cheque by post or in person.
Under certain circumstances, the Commissioner may agree to an extension on this timeframe, or to allow you to pay the duty in instalments. If you do not pay the duty by the agreed date, however, interest and penalty taxes may accrue.
First home buyers who qualify for the First Home Owners Grant may also be eligible for the First Home Owner Rate of duty (FHOR). If the value of the property is less than $430,000, no duty is payable at all. If it is valued between $430,000 - $530,000, duty is charged at a rate of $19.19 for every $100 (whole or in part) over $430,000. If the property value exceeds $530,000, normal rates apply. On vacant land or a house/land package, no duty is payable if the land is worth less than $300,000, and duty is charged at a rate of $13.01 per every $100 exceeding $300,000 if it is worth between $300,000 - $400,000.
If you are purchasing property that is valued at less than $200,000 you may be eligible for a concessional rate of duty. For property valued below $100,000, you will pay $1.50 for every $100 (whole or in part). For property valued between $100,001 - $200,000, you will pay $1,500, plus an additional $4.39 per every $100 (whole or in part) that exceeds $100,000.
Read more about transfer duty in WA here.