Stamp duty: what is it and what do I need to know?
When you purchase a property, you are required to pay numerous fees and charges up front. One of these is stamp duty, and is payable on almost all property purchases.
What is stamp duty?
Stamp duty is a tax, charged by the government, from the sale of a property. It covers the costs of things like changing and transferring the title and ownership of the property. Each state or territory government sets their own stamp duty, and you are required to pay it for property purchases within 30 days of settlement. The amount you will need to pay is set in relation to the value of the property, meaning the more expensive the property, the more stamp duty you will need to pay.
How much is stamp duty?
The fees vary greatly depending on property value, what state or territory you live in, and if you qualify for any concessions or exemptions.
For many new buyers, stamp duty can be a bit of a surprise, so it’s a good idea to know ahead of time how much you’re likely to owe. There’s plenty of online stamp duty calculators available, and can save you from being underprepared. While the calculators won’t be an exact, locked in amount, you’ll get a fair idea and can budget accordingly.
What else do I need to know?
When saving and preparing to purchase a property, ensure that you factor stamp duty into your budget, and you’ll save yourself a lot of stress down the track. There are concessions and exemptions on stamp duty, such as concessions for first home buyers and different rates for buying land, so depending on your personal circumstances you may qualify for one. Again, these differ by state or territory, and have quite a few restrictions so, like all things in property investing, make sure you do your research and speak to professionals for extra guidance.
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