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Any information contained in a blog on this website is general in nature only. The content of any blog posted below reflects information which is known to us as at the date of the posting of the blog. Please be aware that the law regularly changes. Please do not rely on the general information contained in the below blogs, instead we recommend that you contact us to obtain legal advice tailored to your own specific situation.

 

Jun24

RECENT STAMP DUTY CHANGES – INTRODUCTION OF THE FIRST HOME BUYERS ASSISTANCE SCHEME

Amanda Quin - Monday, August 07, 2017

What is stamp duty?

Transfer of land duty (formerly known as stamp duty) is a duty payable on the sale or transfer of land, including improvements in NSW.

Put simply, stamp duty is a tax imposed on the purchaser of land in NSW. The tax is payable to the Revenue NSW (formerly known as the NSW Office of State Revenue).

How is stamp duty calculated? 

Stamp duty is calculated on an ad valorem basis – meaning the amount of stamp duty payable is proportional to the value of the land.

Revenue NSW has a calculator to assist you with your calculations and you may access this on the Revenue NSW website at:

https://www.apps08.osr.nsw.gov.au/erevenue/calculators/landsalesimple.php 

When am I required to pay stamp duty?

You are required to pay stamp duty prior to land being transferred (acquired by you). However there are some exemptions for First Home Buyers.

Who is a First Home Buyer:

Eligibility criteria:

An eligible purchaser is a purchaser who has not, and whose spouse has not:

  • At any time owned (either solely or with someone else) residential property in Australia other than property owned solely as a trustee or executor;
  • Previously received an exemption or concession under the First Home Buyers Assistance Scheme
  • Furthermore an eligible purchaser must:

  • Be over the age of 18 years;
  • Must be an Australian citizen or permanent resident;
  • Must be a natural person - not be a company or trust;
  • Must purchase the whole of the property; and
  • Acquire an interest of at least 50% of the property.
  • First Home Buyers:

    The NSW State Government established the First Home Buyers Assistance Scheme on 1 July 2017 to assist First Home Buyers with acquiring land in NSW by providing them with an exemption from stamp duty in certain circumstances:

  • First Home Buyers Assistance Scheme:
  • Provides an exemption on stamp duty on new and existing homes valued up to $650,000.00;
  • Provides a concession on stamp duty on new and existing homes valued between $650,000.00 - $800,000.00;
  • Provides an exemption on stamp duty on vacant land valued up to $350,000.00;
  • Provides a concession on stamp duty on vacant land valued between $350,000.00 - $450,000.00;
  • Allows purchasers to receive an exemption or concession (as per the above values) if they are purchasing the property with someone that is not a first home buyer and they are purchasing at least 50% of the property. ( Note: this does not apply to spouses). These are called Shared Equity Arrangements and would apply if the first home buyer was purchasing with a relative (other than a spouse) or friend for example. Duty is calculated with reference to the proportion of the property purchased by other parties.
  • First Home Owner Grant (New Homes) Scheme:
  • The First Home Owner Grant (New Homes) Scheme was established to assist eligible first home owners to purchase a new home or build their home by offering a grant.
  • The grant amount is determined based on the date of the eligible transaction:
  • For eligible transactions made on or after 1 January 2016, the grant amount is $10,000.00;
  • For eligible transactions made on or after 1 October 2012 and 31 December 2015, the grant amount is $15,000.00
  • What is a new home?
  • A home that has not been previously occupied or sold as a place of residence.

    Residence Requirement:

    Both the First Home Buyers Assistance Scheme and the First Home Owner Grant (New Homes) Scheme require the home purchased or built to be occupied by at least one of the eligible purchasers as his/her principal place of residence for a continuous period of at least 6 months with that occupation commencing within 12 months after settlement.

    Should you have any queries regarding the abovementioned Schemes, please do not hesitate to contact our office or review some further information on the Revenue NSW website:

    http://www.revenue.nsw.gov.au/grants