Stamp Duty

Are you ready to buy your first home or are you planning to relocate to New South Wales? If so, you’ll need to know what upfront costs are part of the home buying process.

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Are you ready to buy your first home or are you planning to relocate to New South Wales? If so, you’ll need to know what upfront costs are part of the home buying process.

Home to some of the most popular destinations for Australians and foreign nationals, buying in NSW means that specific stamp duty will be imposed on your property purchase.

If you’re looking to find out what stamp duty means, the rates in NSW, and potential exemptions, you’ve come to the right place. This article includes everything you need to know!

What Is Stamp Duty?

When someone buys a home, they are required to pay a land transfer duty, which is also known as stamp duty. This is no different for those purchasing property in NSW.

Stamp duty is a tax charged by the government to transfer the ownership of a property from one person to another. Stamp duty is always paid by the buyer, not the seller.

It can also apply to several different transactions outside the home buying process, including land and vehicle purchases.

Stamp duty charges change depending on what territory of Australia you live in.

How Is Stamp Duty Calculated?

Stamp duty is calculated based on the total property value. It works on a regular up-and-down scale, meaning that the more expensive the property is, the more the stamp duty charge will be.

Depending on where you live in Australia, stamp duty will be calculated based on:

  1. Whether you’re a first-time buyer.
  2. Type of property (residential or investment).
  3. Whether it’s vacant land, a new home, or established property.
  4. Whether you’re an Australian citizen or a foreign buyer.


According to the NSW government, you need to pay stamp duty when you buy one of the following:

  1. Investment property.
  2. Farming property or vacant land.
  3. Industrial or commercial property.
  4. A business that includes land.
  5. Any property that is a home or holiday home.

You must also pay stamp duty when you acquire any land without buying it. This may include land acquired as a gift or through a declaration of trust.

Stamp duty charges are generally applied towards the end of the home loan process. It must be transferred three months after signing a contract of sale or transfer.

How much is stamp duty in NSW?

When calculating stamp duty charges in NSW, you’ll need to consider the sale of the price of the property and its market value.

Using our Stamp Duty Calculator at Lendsreet, you can quickly estimate the amount you’ll need to pay.

Stamp Duty Rates In NSW

According to the NSW State Office of Revenue, the current stamp duty charges stand at:

Value of Property Stamp Duty Rate
$0 to $14,000 $1.25 per $100
$14,000 to $32,000 $175 + $1.50 per $100 above $14,000 in property value
$32,000 to $85,000 $445 + $1.75 per $100 above $32,000 in property value
$85,000 to $319,000 $1,372 + $3.50 per $100 above $85,000 in property value
$319,000 to $1,064,000 $9,562 + $4.50 per $100 above $319,000 in property value
Above $1,064,000 $43,087 + $5.50 per $100 above $1,064,000 in property value

The NSW government also charges what’s known as a premium transfer duty on residential properties above $3 million. Any properties over $3 million face a premium stamp duty rate of $160,237 plus $7.00 for every $100 over $3 million.

Stamp Duty On Larger Properties

Stamp duty on large properties is calculated by using standard and premium rates. The premium transfer rate is used to calculate the first two hectares of the land, and the remainder will be charged at the standard rate.

The example that the NSW government give is:

  1. 10-hectare property worth $20 million.
  2. 2 hectares is 20% of the total area.
  3. 20% of the value is $4 million.
  4. You would pay the premium rate on the value above $3 million.
  5. The remaining will be charged at the rate for the property over $1 million.

Who Is Stamp Duty Payable To In NSW?

In New South Wales, stamp duty charges are paid to the Office of State Revenue. Stamp duty is a type of government tax that goes towards the state budget.

This money is put into the NSW economy and is usually used to support public sectors like transport, emergency services, and education.

How Do I Pay Stamp Duty In NSW?

Stamp duty in NSW is paid towards the end of the home loan process at the time of settlement. Generally, it’s your solicitor or conveyancer that will arrange the stamp duty payment for you.

After your conveyancer or solicitor has lodged an assessment for your home purchase, the NSW government will send a duties notice. This will include the total tax payable (stamp duty and interest) and the due date of the payment.

The NSW government may impose a different means of paying the transfer duty if:

  1. The settlement does not happen before the allocated transfer duty date.
  2. You’ve decided to pay the stamp duty on your own.
  3. You’re not using a conveyancer or solicitor.

If this is the case, the NSW government offers several different payment options, such as an electronic funds transfer (EFT).

Off-The-Plan Purchases And Stamp Duty Deferrals

If you purchase an off-the-plan property, it’s possible to defer your stamp duty payment for up to 12 months.

This is when you enter into a contract to buy a residential property, and the home is to be developed before the transfer is complete. So, an off-the-plan purchase means the house is still under construction, and the plan needs to be registered.

Who Is Exempt From Stamp Duty In NSW?

Some buyers are entitled to be exempt from paying stamp duty charges in NSW. This is usually conditional on where they live, where the property is located, or whether they are first-time buyers.

Since November 2020, the NSW government has begun to change the stamp duty charges with an annual property tax. More specifically, this involves a new property tax system with a small annual tax rather than a one-off transfer duty charge.

However, the stamp duty charge still applies to home buyers, but the good news is that there may be a chance you’re exempt from it.

For example, if you’re a first-time buyer, you could be eligible for a concession or even a full exemption.

First-Home Buyer Assistance Program (FHBAS)

If you’re a first-time buyer, you may be entitled to a concession transfer duty rate under the First-Home Buyer Assistance Program (FHBAS).

In contrast to the First Home Owner Grant (FHOG), the FHBAS is available to those buying an existing home, buying a new home, or buying vacant land with the intent to build.

If your property is valued below $650,000, you’re entitled to a full exemption. If it’s valued between $650,001 and $850,000, you can apply for a concessional stamp duty rate.

This applies to both new and existing homes. In the case of vacant land, you won’t need to pay transfer duty if the land is valued at less than $400,000. For any vacant land valued between $400,000 and $500,000, you’ll receive a concessional rate.

Definition Of A New Home

If you’re purchasing a new home for the first time, it must meet the regulations set by the NSW government. This means that the home has never previously been occupied by anyone or sold as a place of residence.

This includes homes that have been substantially renovated and properties built to replace demolished premises.

Who Is Eligible For The FHBAS?

The NWA government requires that you meet eligibility criteria in order to access concessional rates or full exemption. To qualify, you must:

  1. Purchase an entire property.
  2. Be over the age of 18.
  3. Be an Australian citizen or permanent resident.
  4. Never have owned a residential property in Australia before. This also applies to anyone you’re purchasing the property with.
  5. Not received any previous stamp duty concession or exemption under this scheme.
  6. Purchase as an individual, not trust or company.

FHBAS Requirements for Living In The Property

The NWA government also requires several living conditions to secure a concession or exemption. You must:

  1. Move into your new home within 12 months of buying it.
  2. Live in the property for at least six months.

The living requirements are required by any first-time buyers apart from members of the Australian Defence Force.

Stamp Duty For Foreign Buyers

Concessions and exemptions may be available for first-time buyers, but stamp duty charges are higher for foreign buyers.

If you’re not an Australian citizen and you’re looking to purchase property in NSW, you’ll face an additional transfer surcharge of 8%.

Known as Surcharge Purchaser Duty, this means that all foreign buyers pay more than Australian citizens.

Proposed Changes To Stamp Duty And Land Tax In NSW

The NSW 2020-21 budget revealed that stamp duty would begin to be phased out and replaced with a small annual property tax. In an attempt to reinvigorate the current tax structure, the proposed changes aim to create better opportunities for all potential home buyers.

The current stamp duty structure has been criticised for not only its negative effects on the housing market but also its restrictions on residential mobility.

Stamp duty is a cost that directly affects the home-buying decisions, as many buyers are saving up for a more expensive property instead of a smaller property first to avoid paying transfer duty twice.

The government has said that the long term effects of this change will provide an extra $3,300 of income per household, alongside 75,000 additional jobs.

All Your NSW Stamp Duty Questions Answered By Experts

To recap, when you’re purchasing a house in NSW these are the main questions about stamp duty to consider:

  1. Who pays? It’s the buyer of the property, not the seller, that pays stamp duty.
  2. How do I pay? More than likely, it’s your solicitor or conveyancer that will arrange the stamp duty payment for you. The NSW government accepts payment in person or via electronic transfer.
  3. When is it paid? Stamp duty is paid at the settlement phase of your home buying process. It becomes payable within three months from the date of sale.
  4. Can I apply for an exemption? Yes. If you’re a first-time buyer and you meet all the legibility criteria on the NSW Office of State Revenue website, then you’ll be eligible for an exemption.
  5. Is it possible to apply for a refund? If your sale transfer is cancelled, you can apply for a refund using the NSW website.

Find Out More With A Specialist Australian Broker

Now you know what stamp duty means, maybe you’re that step closer to lodging a home loan? If so, then why not come and chat with an expert mortgage broker at Lendstreet.

We can assist you not only in stamp duty charges but all aspects of your property purchase. Whether you’re a first-time buyer, looking into an investment property, or refinancing, our specialist brokers are ready to secure your financial future.

We always personalise and tailor lending solutions to help you achieve your short and long term plans. Let’s get started and book you in for an appointment today!


Is Stamp Duty Changing In 2021 In NSW?

Under a new proposal by the NSW government, stamp duty is to be phased out and replaced by a smaller annual property tax. The 2020-21 budget aims to change the current tax structure of transfer duty charges. The government stated this would lead to an additional 75,000 jobs and an extra $3,300 of income per household.

How Much Is Stamp Duty In NSW?

The price of the stamp duty in NSW will be calculated based on the property’s sale price of your property and the property market value. For example, if a property is valued between $85,000 to $319,000, the stamp duty rate will be $1,372 plus $3.50 for every $100 over $85,000. Premium duty rates apply for all residential properties that are above $3 million.

How Do I Avoid Stamp Duty In NSW?

The more likely way to avoid paying stamp duty in NSW is to apply for the First-Home Buyer Assistance Scheme (FHBAS). The FHBAS is available to those buying an existing home, buying a new home, or buying vacant land with the intent to build. If your property is valued below $650,000, then you’re entitled to a full exemption.

What Is Stamp Duty Exemption in NSW?

Stamp duty exemptions are when you avoid paying the transfer fees of buying a new home. You can now find out if you’re exempt from stamp duty fees by applying for the NSW government’s First-Home Buyer Assistance Scheme (FHBAS). If your desired property is valued at less than $650,000, then you’re entitled to a full exemption.

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