Stamp duty is a costly and often unavoidable upfront expenditure when purchasing a house in NSW. However, you may be eligible for a reduction or perhaps an exemption, especially if this is your first house. The true cost of stamp duty is examined in this article. I can be your real estate agent in Minto and help you get the most affordable stamp duty cost on estates.

What does stamp duty mean?

When you purchase a house, you will be required to pay stamp duty (also called transfer duty).

It’s essentially a levy levied by state and territory governments to transfer property ownership to someone else. The buyer, not the seller, is subject to stamp duty.

Transfer duty applies to a variety of transactions, including the acquisition of a motor vehicle, a business that incorporates land, and some insurance contracts.

If you’re selling or transferring land (including renovations) or a company in NSW, you’ll have to pay stamp duty.

A stamp duty responsibility arises when a sale or transfer happens, and it makes no difference whether the transaction is completed through a written document or through other methods, including technological ones. When a sale or transfer is made by a written document, however, stamp duty obligation begins when the instrument is first executed.

In New South Wales, stamp duty must be paid within three months of the day the responsibility occurs. The duty is payable by the purchaser or transferee.

How does NSW charge stamp duties

Stamp duty is levied by the NSW government on the following transactions:

  • a contract for the purchase or sale of dutiable property,
  • a trust statement for dutiable property,
  • relinquishment of a land interest in New South Wales,
  • mortgage foreclosure on the dutiable property,
  • a dutiable property vesting,
  • Section 134 of the Conveyancing Act 1919 allows for the conversion of a term in the land into fee simple.
  • statutory vesting of land in New South Wales, whether within or outside Australia

Can you avoid stamp duty NSW?

Yes, it is possible to avoid stamp duties in NSW if you are a first-time buyer.

The NSW government announced intentions to phase out stamp duty in favor of an annual property tax in November 2020. The government issued a progress document as an update on the plan after public engagement.

Currently, several situations may allow you to avoid or decrease stamp duty, such as becoming a beneficiary of a deceased estate or transferring property to a partner or spouse.

If you’re a first-time homebuyer, you may be eligible for a stamp duty reduction or possibly a stamp duty exemption.

The New South Wales government offers stamp duty discounts to first-time property buyers as an incentive:

Stamp Duty Exemption for Residential Homes – If you buy a property for less than $550,000, you won’t have to pay any stamp duty. On a house between $550,000 and $650,000, you can get a First Home Plus concession by multiplying the purchase price by 0.2474 and subtracting $136,070.

For Unoccupied Land – If you buy vacant land for less than $350,000, you don’t have to pay stamp duty. The First Home Plus concession is offered on property valued between $350,000 and $450,000 if the purchase price is multiplied by 0.1574 and then subtracted $55,090.

Do foreign buyers need to pay stamp duty?

How much is stamp duty NSW for foreigners?

While first-time home purchasers may benefit from stamp duty exemptions, international buyers do not.

If you’re not an Australian resident or citizen and you buy a home in NSW, you’ll have to pay an extra 8% stamp duty.

This is referred to as surcharge purchaser duty, and it is paid on top of any transfer duty.

Rate of stamp duty NSW

Value of Property

Rate of Stamp duty NSW

$0 to $14,000

$1.25 for every $100 (the minimum is $10)

$14,000 to $32,000

$175 plus $1.50 for every $100 over $14,000

$32,000 to $85,000

$445 plus $1.75 for every $100 over $32,000

$85,000 to $319,000

$1,372 plus $3.50 for every $100 over $85,000

$319,000 to $1,064,000

$9,562 plus $4.50 for every $100 over $319,000

Over $1,064,000

$43,087 plus $5.50 for every $100 over $1,064,00

How to pay stamp duty NSW

In NSW, Stamp duty must be paid within three months after the completion of the property sale. Your lawyer or conveyancer will apply for the duties assessment on your behalf and handle the payment. This is generally done throughout the settlement process, and they’ll let you know whether you qualify for any concessions or exemptions.

You can perform your own conveyancing and submit a responsibilities assessment application, however, it is advised that you hire an attorney or conveyancer to ensure you are complying with the law and prevent hazards. You can pay by BPAY, electronic funds transfer (EFT), or mail once your total taxes and duties have been calculated.

When to pay stamp duty NSW?

When a transaction or sale is concluded, and contracts are either exchanged or finalized, you become responsible for stamp duty. When buying a home, whether with or without a loan, stamp duty must be paid within three months of the transaction’s completion. After three months, interest will begin to accrue, and you will be responsible for it as well.

Stamp duty must be paid within 15 months of the contracts being exchanged or finalized if you are acquiring a residential unit off the plan.

How much is stamp duty NSW for land over two hectares?

The standard and premium transfer rates are used to compute transfer duty on big properties.

Only the first two hectares of land, as a percentage of the whole lot, are subject to the premium transfer rate. The regular rate will be applied to the remainder of the property.

Here’s an example to help you understand better:
The value of a 10-hectare property is $20 million.
Twenty percent of the entire area is two hectares.
The value of 20% of the property is $4 million.

You have all the necessary information that you need regarding how much is stamp duty NSW. If you hire me as your real estate agent in Minto, I can help you with all your needs and stamp duty payments.

You can contact me here for further needs:
Phone number:  +61 435 024 368