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One of the biggest upfront costs for buying a property is stamp duty. Many buyers are caught out when they do not include stamp duty in their budget and have to keep saving before they can buy a property.

What is stamp duty?

Stamp duty is a duty or tax charged by the State Government for certain types of transactions such as selling property, cars and assets which belong to a business. It is paid by the purchaser of these assets and is payable to the state revenue office.

The amount of stamp duty you will have to pay when you purchase a property will depend on which state you are purchasing. It varies state by state and is generally based on the purchase price of the property and can vary if:

  • It is your primary residence or an investment property
  • It is an existing property, newly constructed or vacant land
  • You are a first home buyer

Stamp duty needs to be paid within 30 days of the transaction, so for property, it must be paid within 30 days of settlement.

How much will I pay?

Stamp duty is calculated on the purchase price so it increases in line how much you purchase the property for.

Do it yourself

Figure how much stamp duty you’ll pay with our Stamp Duty Calculator.

How stamp duty is calculated

The property value used in the calculation will either be the purchase price or valuation, whichever is higher. These can be different in certain situations. For example, in a favourable purchase you purchase a property for less than what it is worth from a friend or family member. It usually doesn’t involve a real estate agent.

For off-the-plan purchases, the stamp duty is often calculated on the value of the land and buildings as at the date of the contract of sale. This is the date when contracts are signed and the deposit is paid. Therefore, if construction is yet to be commenced you may pay a lot less in stamp duty compared to purchasing an existing property. If construction is almost complete when you sign the contract then it will be unlikely to be discounted at all.

To see how the states differ, here is an example of the stamp duty payable for purchasing a $500,000 property. The calculations below were done in June 2016 so are only correct based on that date.

State Owner Occupied Investment
NSW $17,990 $17,990
VIC $21,970 $25,070
QLD $8,750 $15,925
ACT $14,600 $14,600
SA $21,330 $21,330
WA $17,765 $17,765
NT $23,926 $23,926
TAS $18,248 $18,248

From this you can see that:-

New South Wales: Stamp duty is the same regardless of whether it is your own residence or an investment property.

Victoria: Victoria comes in as the most expensive out of all the states for stamp duty on investment properties. Although the stamp duty on owner occupied homes is less it is still the second highest out of all the states.

Queensland: Queensland has the cheapest stamp duty out of all the states for owner occupied homes. Investors can pay over double this amount for the same property, but even then it is still one of the cheapest.

ACT: Similar to NSW, ACT levies the same amount regardless of whether it is an investment property or own residence. Overall it has the cheapest stamp duty for investment properties out of all the states.

South Australia: South Australia is in the top three for the most expensive stamp duty. It is the same regardless of whether it is owner occupied or investment.

Western Australia: A concessional rate of stamp duty applies to the purchase of properties below $200,000 that you intend to live in. The same amount of stamp duty is payable regardless of whether it is owner occupied or investment and is at the mid-way point in terms of cost out of all the states.

Northern Territory: Overall the Northern Territory levies the highest amount of stamp duty out of all the states for owner occupied homes and the second highest for investment properties. It is the same regardless of whether it is an owner occupied home or investment property.

Tasmania: Tasmania has the same amount of stamp duty for owner occupied and investment properties. It is also mid-way in terms of how much is levied compared to the other states.

For more information

The find out exactly what stamp duty is payable and if you are entitled to any concessions, you would need to contact the Office of State Revenue in your state. Below are their website links:

Stamp duty exemptions

All land transfers and property sales will incur stamp duty, however there are some concessions and exemptions that could apply to you.

  • First home buyers
  • Pensioners
  • Low property value
  • Deceased estates
  • Off the plan purchase

To find out if you qualify for any concessions, refer to your state revenue office above.

How is it paid?

Stamp duty is payable to the state revenue office prior to the lodging of the transfer of land to the land titles office. It is usually paid by the purchaser’s lender or legal representative after settlement, usually with funds that the purchaser contributed prior to settlement.

Top tips to reduce stamp duty

  • Buyer a cheaper property: In most states, stamp duty increases significantly once the property value goes over $500,000. It may be worth looking for a property below this amount to save more.

  • Consider buying interstate: If the state you are looking to purchase in has high stamp duty fees, take a look interstate. You may find that other state governments have significantly lower stamp duty fees. It may be harder to move to another state, but if you are buying an investment property, this tactic could work well.

  • Reduce building costs: If you purchase a house and land package, the more the property is worth, the more stamp duty you will pay. Reducing the cost of building your property could help save you thousands.

  • Contact your state government: They will be able to give you the right information for your area and let you know what factors will affect how much you pay in stamp duty.

To get an idea about how much stamp duty you may have to pay, you can try the online State Custodians Stamp Duty Calculator. You can also give our friendly Lending Specialist team a call on 13 72 62 or leave your details here and they will contact you to discuss your options.