Stamp duty is imposed by the State Government on purchases of property in New South Wales. Stamp duty is calculated at the ‘ad valorem’ rate on the dutiable value of your property. Usually, the dutiable value is the price that you pay for the property. The Office of State Revenue website has a stamp duty calculator which you might find useful when considering purchasing a property.
Your liability for stamp duty arises upon exchange of contracts and is payable within 3 months of that date. When purchasing property ‘off the plan’, the duty must be paid within three months from the date of: (a) completion of the purchase; (b) the assignment of the whole or any part of your interest under the contract; or (c) the expiration of 12 months after the date of exchange, whichever occurs first.
When considering the purchase or transfer of real estate, you should consider whether any of the available exemptions or concessions to stamp duty may apply. The following exemptions and concessions to stamp duty are currently available:
- Transfers to married couples and de facto partners – no duty is chargeable on the transfer of residential land if, as a result of that transfer, the property will be held by a married (or de facto) couple as tenants in common in equal shares or joint tenants.
- Transfers as a result of a breakdown of marriage, de facto relationship or domestic relationship – no duty is chargeable on the transfer of matrimonial or relationship property, subject to the conditions of the Duties Act being met.
- Intergenerational rural transfers – no stamp duty is chargeable on transfers of farm land (that is, land used for primary production) from one generation to the next, subject to the conditions of the Duties Act being met.
- Exemption from aggregation of dutiable transactions for home builders – licensed builders are exempt from the aggregation of stamp duty on the purchase of multiple blocks of vacant land, so long as the purpose of the acquisitions is to construct a dwelling for the purpose of being sold to the public.
- Partition of land – concessions of stamp duty apply in relation to the partition of land.
- Termination of a strata scheme – no duty is payable on the transfer of property which, upon termination of the strata scheme, is transferred from the owners corporation to the individual proprietors of the lots in the strata scheme prior to termination.
- Termination of a scheme under the Community Land Development Act 1989 – no duty is payable on the transfer of property which is transferred from a community association to individual proprietors of lots in the community scheme as a result of, but prior to, termination of that community scheme.
- The Crown – the Crown or a statutory body representing the Crown is exempt from the payment of stamp duty.
You may also be eligible for a grant under a relevant scheme. These grant schemes change from time to time. Trouncer Legal will advise you if a particular grant scheme applies to your circumstances and will assist you to prepare and lodge your application.