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What is the reduction of duty for eligible first home buyers?
For dutiable transactions with a settlement date on or after 1 July 2011, land transfer duty will be reduced for eligible first home buyers purchasing a principal place of residence (PPR) valued up to $600,000. To be eligible for the duty reduction, the first home buyer must have received or be entitled to receive the First Home Owner Grant and must also reside in the property for a continuous period of 12 months commencing within 12 months of settlement.
The duty reduction of 50 per cent will be phased in over four years, with a 20 per cent reduction on 1 July 2011, followed by additional 10 per cent reductions on 1 January 2013, 1 January 2014 and 1 September 2014.
| Value of Property | Present Stamp Duty (Principal Place of Residence) | 20% Reduction - Duty Payable | 20% Reduction - Saving | 50% Reduction - Duty Payable | 50% Reduction - Saving |
|---|---|---|---|---|---|
| $200 000 | $6 370 | $5 096 | $1 274 | $3 185 | $3 185 |
| $300 000 | $11 370 | $9 096 | $2 274 | $5 685 | $5 685 |
| $400 000 | $16 370 | $13 096 | $3 274 | $8 185 | $8 185 |
| $500 000 | $21 970 | $17 576 | $4 394 | $10 985 | $10 985 |
| $565 000 | $28 970 | $23 176 | $5 794 | $14 485 | $14 485 |
| $600 000 | $31 070 | $24 856 | $6 214 | $15 535 | $15 535 |
An eligible first home buyer will still be entitled to a duty reduction where they entered into a contract to purchase their first home before 1 July 2011, as long as settlement occurs on or after that date. For contracts entered into on or after 6 May 2008 and settled before 1 July 2011 a Principal Place of Residence Concession may still apply.
|
Dutiable value of the PPR |
Reduced rate of duty |
Standard rate of duty |
|---|---|---|
| >$0 - $25,000 | (1.4% of the dutiable value of the property) less 20% | 1.4% of the dutiable value of the property |
| >$25,000 to $130,000 | ($350 plus 2.4% of the dutiable value in excess of $25,000) less 20% | $350 plus 2.4% of the dutiable value in excess of $25,000 |
| > $130,000 to $440,000 | ($2,870 plus 5% of the dutiable value in excess of $130,000) less 20% | $2,870 plus 6 per cent of the dutiable value in excess of $130,000 |
| > $440,000 to $550,000 | ($18,370 plus 6% of the dutiable value in excess of $440,000) less 20% | |
| > $550,000 to $600,000 | ($2,870 plus 6% of the dutiable value in excess of $130,000) less 20% |
For dutiable transactions with a settlement date on or after 1 July 2011, the purchaser may be entitled to the reduction of duty if they:
Where there are two or more purchasers, at least one of them must satisfy the above residency requirement. However, it is not necessary for the same purchaser to occupy the home for the whole 12 months.
If these requirements are not met, duty may be assessed at the standard rate. The Commissioner of State Revenue (the Commissioner) may exercise his discretion to vary the residence requirement where he is satisfied that there is a good reason for doing so.
Furthermore, land will not be considered to be occupied as a PPR unless there is a building on the land that, in the Commissioner's opinion, is designed and constructed primarily for residential purposes and may lawfully be used as a PPR. If you have received the PPR concession, you must notify the Commissioner in writing, of any changes in your circumstances that will result in the residence requirement not being met.
For transfers settled on or after 1 July 2011, please use SRO Duties Form 53B - Principal Place of Residence (PPR) Concession and First Home Buyer Duty Reduction Statutory Declaration.
If you qualify for the reduction of duty for eligible first home buyers you may also be eligible for the pensioner exemption or concession.
If you qualify for both the duty reduction and the pensioner exemption or concession, you must elect to receive one or the other. You cannot receive both. If you do not make an election you will automatically receive the duty reduction.
For further information please contact our office on 1300 755 133
or visit http://www.sro.vic.gov.au
or contact the S.R.O. (State Revenue Office) in your State.
Ph 1300 755 133
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Whilst every effort has been taken to ensure accuracy of above information, please refer to www.sro.vic.gov.au to undertake your own research and due diligence as to accuracy of information as well as to protect yourself from any changes/updates since this document was prepared. Conditions apply and some applicants may not qualify.
