If you purchase a house or land in Australia, odds are you’ll have to pay stamp duty on the purchase. Also known as transfer or land duty, stamp duty is essentially a transfer fee paid by the property buyer to transfer the property title into their name.
Stamp duty is a tax that can take many home buyers by surprise, namely because:
Stamp duty functions in much the same way in New South Wales (NSW) as it does in other states and territories around Australia, since it’s a state/territory government tax applied on the purchase and title transfer of land and property. It’s paid by all types of buyers, such as owner-occupiers buying a primary residence and investors buying an investment property, as well as those buying land for commercial or industrial use.
However, NSW differs from the other states and territories in that it has introduced an alternative to stamp duty for eligible first home buyers, via its First Home Buyer Choice. Eligible homebuyers can choose to pay an annual land tax instead of an upfront stamp duty bill, reducing their immediate homebuying costs.
For homebuyers who do have to pay stamp duty, the NSW stamp duty calculator below can help you get an idea of what your stamp duty costs might look like based on several factors, including the value of your property and whether it’s your home that you reside in or an investment property.
In NSW, stamp duty is generally calculated on the total dutiable value (list price or market value) of the property. So, it’s worth noting that stamp duty calculations are based on the value of the property you’re purchasing, rather than the size of the loan you take out to buy it.
NSW’s transfer duty rates and thresholds are re-assessed every year by the NSW Government to ensure they’re moving in line with any changes to Australia’s Consumer Price Index (CPI). NSW’s standard transfer stamp duty applies to transfers of properties valued at under $3 million, while premium rates apply for properties of greater value.
If you purchased property or land in a previous year, it’s likely the stamp duty you paid will be different from the current rates as these have changed several times in the past few years. Using the NSW stamp duty calculator built into our home loan comparison tool can give you a better idea of what you might pay overall if you purchased your home in a prior year.
The current standard and premium stamp duty rates in NSW (as of July 2022) are listed in the table below:
| Property value | Transfer duty rate |
| $0 to $15,000 | $1.25 for every $100 (minimum $10) |
| $15,000 to $32,000 | $187 plus $1.50 for every $100 over $15,000 |
| $32,000 to $87,000 | $442 plus $1.75 for every $100 over $32,000 |
| $87,000 to $327,000 | $1,405 plus $3.50 for every $100 over $87,000 |
| $327,000 to $1,089,000 | $9,805 plus $4.50 for every $100 over $327,000 |
| Over $1,089,000 | $44,095 plus $5.50 for every $100 over $1,089,000 |
| (Premium) Over $3,268,000 | $163,940 plus $7.00 for every $100 over $3,268,000 |
| Source: Revenue NSW1 | |
Say you buy a home for $600,050. According to the duty rate brackets above, this means you’d pay $9,805 plus $4.50 for each $100 over $327,000. To figure out how much stamp duty you’d pay all up, we’ve got some calculations to do.
Step 1. Figure out how many blocks of $100 there are between $327,000 and the purchase price of $600,050.
There’s a $273,050 difference between the two figures: $100 goes into that 2,730 times, and the additional $50 is treated as the full $100 as well. This means there are 2,731 blocks of $100 we need to use for stamp duty calculation purposes.
Step 2. Multiply 2,731 by $4.50 to calculate the second half of your stamp duty
2,731 x $4.50 = $12,289.50
Step 3. Add the two components of your stamp duty together
$9,805 + $12,289.50 = $22,094.50
This means that on top of the purchase price of $600,050, you’d pay approximately $22,094.50 in stamp duty. However, it’s important to note that your house-buying costs don’t end there – you may also have to pay for things like:
In NSW, stamp duty is payable on the transfer of various property types. You’ll typically pay stamp duty if you’re purchasing:
However, depending on your circumstances, you could be eligible for certain stamp duty concessions or even a complete stamp duty exemption.
Exemptions and concessions are usually based on the price of the property but can also be granted under special circumstances (such as inheriting a deceased estate or title transfers between de facto couples). They’re also commonly available to those buying a home for the first time.
Unless they’re eligible for a stamp duty exemption of some kind, anyone purchasing property in NSW will have to pay stamp duty on their property transaction.
The seller of the property does not have to pay stamp duty, as the property is not being transferred into their name. However, if they purchase a property afterwards, they will have to pay stamp duty on that transaction.
Introduced in November 2022, First Home Buyer Choice is a NSW Government initiative which allows eligible first home buyers to opt out of paying stamp duty and instead pay a smaller annual property tax.²
The scheme is available to eligible first home buyers purchasing a property worth up to $1.5 million, and the applicable annual tax rates for 2022 through to 2024 will be:
To qualify as an eligible first home buyer for First Home Buyer choice an individual must:
You can learn more about First Home Buyer Choice by visiting the NSW Government website.
In NSW, stamp duty must be paid within three months of signing the contract for the sale or transfer of the property. However, if you make an off-the-plan purchase (i.e. purchasing property that’s not yet built), you may be able to delay paying stamp duty for up to 12 months. If you have a solicitor or conveyancer acting on your behalf, they will typically handle this process for you.
That being said, stamp duty will typically be paid at settlement day by your solicitor or conveyancer if the property purchase involves a home loan. With that in mind, the three-month grace period afforded to property buyers may only be useful for those who can afford to buy outright, without needing finance.
Eligible first home buyers may be able to avoid paying stamp duty in NSW, by opting to pay an annual land tax via First Home Buyer Choice instead.
However, first home buyers in NSW who either aren’t eligible for First Home Buyer Choice or are choosing to pay stamp duty may be eligible for either concessional rates or a total exemption, in accordance with the NSW First Home Buyers Assistance Scheme (FHBAS).³
These stamp duty breaks depend on the value of the property and whether you’re purchasing a new home, existing home or vacant land.
The NSW stamp duty exemptions and concessions for first home buyers (as of July 2022) are listed below:⁴
| New homes | Existing homes | Vacant land |
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In NSW, stamp duty is payable if you purchase vacant land of any kind, whether it be residential, commercial or industrial. You could be eligible for an exemption if the land is valued at less than $350,000, or a stamp duty concession if it’s valued between $350,000 and $450,000.
It’s worth noting that you may still need to pay stamp duty in NSW if you acquire land as a gift or through a trust, meaning you can end up with stamp duty payable even if you didn’t purchase the land yourself.
Foreign buyers, companies and trusts purchasing residential property in NSW must pay transfer duty and may be subject to an additional 8% surcharge purchaser duty.⁵ However, you won’t need to pay the additional charge if you’re an Australian citizen, Australian permanent resident, New Zealand citizen (holding a subclass 444 visa) or have a valid 309 or 820 partner provisional visa.
Stamp duty payments are addressed to NSW’s revenue office either in person, via electronic funds transfer, BPAY, advance payment or by mail. For further information on how to pay your stamp duty and how non-payment could affect you, please check with Revenue NSW. However, if you have a solicitor or conveyancer acting on your behalf, they will handle the payment process for you.
Different parts of Australia will charge different rates of stamp duty and may take different considerations into account when calculating your payable stamp duty. We can assist you in learning more about how stamp duty works in:
As General Manager of Money at Compare the Market, Stephen Zeller wants to help first homebuyers understand what their upfront property buying costs might look like, as well as reduce them where possible. Whether you opt to pay stamp duty or land tax, you should know how much it’s going to cost you!
Stephen has more than 30 years of experience in the financial services industry and is an Allied Member of the Australian and New Zealand Institute of Insurance and Finance (ANZIIF). He helps to review and contribute to Compare the Market’s banking-relating content, to ensure it’s as helpful and empowering as possible for our readers.
Buying a new property is already stressful enough without having to fret further over how much extra you’ll have to pay in stamp duty. With stamp duty often costing the buyer thousands of dollars, it’s not something to leave till the last minute or rush blindly in to.
But don’t forget to make sure you’re getting value from your home loan! Our home loan comparison tool can help you compare your options on rates, fees and more, to help you make a more informed home loan decision. Simples!
