Every Australian state and territory government levies a tax on property purchases. This tax is called Stamp Duty, and must be paid by the buyer of a property within a specific timeframe. This time frame differs from state-to-state, ranging from within 28 days in the ACT, to within three months in NSW and Tasmania.
The total amount of Stamp Duty payable on a property depends on several factors, including the location of the property (Victoria charges the most and Queensland the least), the purchase price, and the loan purpose.
There are some properties and circumstances that are exempt from the tax. For instance, first home buyers in NSW and Victoria are exempt (up to specific purchase prices), and if a property changes hands as a result of death or divorce, then no Stamp Duty is Payable.
This tax needs to be taken into account when budgeting for your next property. As house prices rise and fall, Stamp Duty can expand or shrink dramatically, so make sure you understand just how much you might be liable for.
You may want to start with a Stamp Duty calculator if you’re considering purchasing a new property.