When purchasing any property in Australia, you have to commit to stamp duty. As a necessary evil for in the world of the property investments, it is best that you know what it is and how it affects you. This can help ease some parts of the process.
Stamp duty is a tax imposed by state or territory governments. These are placed on acquisitions such as property investments, cars, home loans, and mortgages. You need to pay this around the time of purchase, with a 30-day window from the settlement date.
All property transactions impose stamp duty. This means your real estate investment opportunities require it. Gifts of property and land also draw stamp duty. You might be able to get a concession, but it will vary based on factors like who you are and where the property investments are located.
Rates will vary by territory. You can expect significant differences to come up. A common error for first-time investors is to fail to account for these differences.
Stamp duty relies on a sliding scale of taxation. The more expensive or valuable the property investments, the higher the rate of stamp duty required. Be sure to factor that into the budget before you make any purchases.
In property transactions, the purchaser always pays stamp duty. As noted earlier, you have 30 days from the property settlement to pay your dues.
Rates will vary from state to state, with each one having its own formula and calculation. Working it out can be difficult if you purchase property in different states, so it is beneficial to have a professional handle the task.
Stamp duty calculators are available for free, provided by state or territory governments. These tools are designed specifically to compute the stamp duty required. The tool is flexible enough to accommodate various buying scenarios. However, they do not typically factor in concessions.