FREQUENTLY ASKED QUESTIONS: How much is stamp duty

1. But first, what is stamp duty? Stamp duty, also known as transfer duty, is a one-off government fee paid by the purchaser of a property in NSW. You must pay stamp duty in NSW when you buy: a home or holiday home an investment property vacant land or a farming property commercial or industrial properties a business, which includes land.

2. How do I calculate stamp duty in NSW? Stamp duty is generally calculated on the market value of the property. So the higher the property value, the more expensive the stamp duty will be. The stamp duty (transfer) rates for NSW from 1 July 2020 are as follows:

For example, if you were purchasing a $600,000 house in New South Wales, you would fall within the $310,000 to $1,033,000 category. Therefore, you would be charged an upfront stamp duty of $9,285 plus an additional charge of $13,050 for a total of $22,335. Given the higher-priced property in and around Sydney, a Sydney buyer purchasing a $1.2 million property will need to pay stamp duty of $51,005.

3. How do I pay stamp duty? Stamp duty must be paid within 3 months of the property sale being finalised. Your solicitor or conveyancer will apply for the duties assessment and organise the payment on your behalf. This is usually done during the settlement process and they will likely inform you if you are eligible for any concessions or exemptions.

4. When does stamp duty have to be paid? Stamp duty is generally required to be paid within 3 months of the transaction. The purchaser pays stamp duty on or before the settlement date. If the purchaser has available funds, payment of stamp duty can be made prior to settlement.

5. How can I avoid paying stamp duty? Like death and taxes, the payment of stamp duty in NSW for the purchase or transfer of property is generally inevitable, unless stamp duty is exempt. Some exemptions may include first home owners, transferring to a spouse or inheriting a property from an estate.

6. Common pitfalls to avoid Now that you understand stamp duty, there are some issues that you should not overlook. Always consider the stamp duty amount in your budget. If more than one property is purchased from the same seller, you could incur higher stamp duty if those properties are classified as aggregate and as a single transaction. If you fail to pay stamp duty on time, penalties may be imposed against you.

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