Has the cost of stamp duty crept up on you? This tax can be quite expensive and is often overlooked by many buyers.
Now commonly referred to as land transfer tax, stamp duty is a tax on the sale of property purchases in Australia, and covers the cost of transferring land from one individual to another. The amount of tax varies between states and territories, as well as the cost of the property itself.
Take a look at our handy Stamp Duty Calculator below. This powerful tool will provide a guide on how much stamp duty you could be charged on a property, and ultimately help you maximise your finances – especially when used in conjunction with our Borrowing Power Calculator, Loan Comparison Calculator, and our Property Buying Cost Calculator.
When calculating house stamp duty for Victoria (VIC), you will receive a guide on any stamp duty exemptions or grants you may be eligible for, depending on the information you provide.
How is stamp duty calculated in Victoria?
The amount of stamp duty you are required to pay depends on the dutiable value of the property.
Victoria calculates its stamp duty by applying a sliding scale of taxation based on the property’s purchase price or its market value – whichever value is greater. This scale starts at 1.4% for properties valued at $25,000, and rises to 5.5% for properties valued $960,000 and above.
If you purchase a property with a dwelling already built, you need to pay stamp duty on the combined value of the house and land. For vacant lots where the seller will build a house before you settle as part of your contract, you are still required to pay stamp duty on the combined value of the house and land.
For vacant land which has no dwelling built on it and you plan to build under a separate contract, you are only required to pay stamp duty on the land.
Click the “rates and thresholds” button towards the bottom left of our calculator for a guide on stamp duty rates and thresholds in Victoria. The information that pops up outlines the following in detail:
- stamp duty: non-principal place of residence rate
- stamp duty: foreign purchaser
- stamp duty: principal place of residence (PPR) rate
- First Home Buyer Concession
- eligible pensioners
- mortgage registration fee
- land transfer fee
- First Home Owner Grant
- property location for first home owner grant.
Using our House Stamp Duty Calculator for Victoria
We have included a detailed breakdown of the information you’ll need to input, particularly for those using our calculator as a house stamp duty calculator for Victoria.
1. Enter your details
- Value of property: Input the value of the property you’re planning to purchase. The property may be vacant land, an established home, or a house-and-land package.
- Property location: Select where your property is located in the drop-down menu. If you’re buying or building a new home in regional Victoria, you could be eligible for a $20,000 First Home Owner Grant. A list of these properties against the grant award appears when selecting the “rates and thresholds” button.
- Are you a first home buyer? This information is important, as eligible first home buyers in Victoria can be granted $10,000 for buying or building a new home valued up to $750,000. For homes built in regional Victoria, the grant has increased to $20,000, which is viewable when selecting the “rates and thresholds” button. Eligibility requirements for the First Home Buyers Grant include the following:
- You must be purchasing either a new home or vacant land (with the intention to build a new home within 12 months).
- Your home’s total value must be less than the upper property value threshold amount (click our “rates and thresholds” button to check these threshold amounts).
- Buyers of the home or land must be over 18 years old.
- All buyers including any partners must satisfy current or previous home ownership test.
- One buyer must satisfy residential requirements.
- For the grant to apply, you must be purchasing either vacant land (with the intention to build a new home within 12 months) or a new home.
- Helpful hint: try out the State Revenue Office of Victoria’s First Home Owner Grant eligibility test.
- Property type: A First Home Owner Grant applies if you are purchasing a new home or vacant land (to build a new home within 12 months of purchase) for your primary residence. You won’t receive this grant, however, if you are investing in a property.
- Are you purchasing? Select either “established home”, “new home”, or “vacant land”. This will impact any concessions for which you may be eligible. For the First Home Owners Grant to apply to vacant land, you must build a new home as a principal place of residence within 12 months. If you plan to take longer than 12 months to build your home, select “no” for the first home buyer option.
- Eligible pensioner: If you are an eligible pensioner, you could be entitled to a once-only exemption of concession from paying stamp duty when you purchase a home valued $750,000 or less. This house may be established, be built as part of a house-and-land package, or a home built within three years of acquiring the land. To be eligible for a pensioner concession, you must:
- hold an approved concession card at the date of transfer
- purchase the property at market value
- purchase your home as your principal place of residence.
- Foreign purchaser: Foreign purchasers who acquire a residential property are required to pay foreign purchaser additional duty (FPAD) on top of stamp duty on the dutiable value of your property.
Payment method: Selecting either an electronic payment or paper payment will affect the cost of your mortgage registration fee and your land transfer fee (which is reflected on our Victoria stamp duty calculator):
- Mortgage registration fee 2017 – 2018:
(a) Paper transaction: $114.90 (b) Electronic transaction: $106.40
- Land transfer fee:
(a) Paper transaction fee: the sum of $94.60 plus $2.34 for every whole consideration, the maximum fee is $3,605.00
(b) Electronic transaction fee: the sum of $85.90 plus $2.34 for every whole consideration, the maximum fee is $3,596.00
2. Government fees
This section of our calculator highlights the following results:
- Stamp duty of property: This refers to the amount of stamp duty you may be required to pay based on the information you’ve provided.
- Mortgage registration: The figure displayed is the amount your registration will cost. Mortgage registration is a State Government fee applied when registering your home loan. Home loans must be registered, so all claims on a property can be checked by the property’s future buyers.
- Transfer fee: This is the estimated cost of transferring the land and titles into your ownership.
The total amount of fees appears under “total government fees”.
3. Government grant
This section of the results estimates any government grants you may be entitled to, depending on the information you have provided. The total amount of these grants appears under “total government grant”.
Frequently asked questions
What other stamp duty, grants, exemptions, or concessions apply to me?
There are a few exemptions from stamp duty that may apply to you. Apart from the first home owners grant and pensioner duty exemption or concession, other concessions or exemptions can include:
- Principal Place of Residence (PPR) Concession: This concession isn’t just available to first-home owners. Homebuyers whose property is valued up to $550,000 who meet certain criteria including:
- Using the property as PPR within 12 months of owning property and
- Residing in the property for a continuous period of at least 12 months.
Land must have a building designed for residential purposes to be considered PPR.
How can I reduce my stamp duty costs?
Stamp duty becomes more expensive the higher the cost of your new home or block of land. The following tips may help you maximise your money:
- Consider a cheaper property. As stamp duty significantly rises on properties over $500,000, it may be better to purchase a home below this value.
- Negotiate with the seller. Try negotiating with the seller to reduce the purchase price, which can offset your stamp duty costs.
For further information on how stamp duty could affect you as well as information on more exemptions and concessions, please visit the State Revenue Office Victoria.
Make purchasing your home even easier
Ease the stress of purchasing a new home with our First Home Buyer’s guide for insight into the types of home loans available, the process of applying for a loan, and the ongoing costs of owning a home (beyond your mortgage), among other helpful topics.
When it comes to making the big step towards purchasing your new home, it’s important you take out the loan that suits your needs, lifestyle, and budget. Comparing home loans with our free online service means you’re guaranteed to find a great deal in just a few minutes.
Get started today.
The information in this article is accurate at 2 January 2018.