Understanding Stamp Duty in 2018
Buying a new home can be overwhelming especially for first home buyers as it is the largest transaction that most people will make in their lifetime. Working out how much tax to pay is difficult
But what is stamp duty?
Stamp duty is the revenue levied by states on various transfers and agreements such as real estate. Stamp duty is charged based on the greater market value of the property including GST. The more expensive the property, the higher stamp duty rate is paid. Stamp duty rates vary as it is decided by each state or territory governments. A vacant property will have less stamp duty charged to it when compared to buying a home.
Stamp duty is paid within 30 days of the settlement of the property and paid by the purchaser. It is collected by state government and invested into the economy, where the revenue is used for sectors such as health, emergency services, transport and roads.
There are some exemptions that you can apply for depending on what state you live in. The value of your house, first home owners, and pensioner and health card holders are factors that can determine whether you are eligible for stamp duty exemptions. In South Australia, there are a few exemptions and concessions available that can assist with offsetting stamp duty such as the ‘Off-the-Plan’ concession, for those buying a new or renovated apartment in specific areas of the City of Adelaide for example.
How do you pay stamp duty?
The process is a relatively simple one. A letter will be posted to you at the address you have purchased unless otherwise specified containing all the information you need regarding stamp duty including the amount that needs to be paid. Usually the tax is paid via direct deposit, bank transfer, cheque or credit card to the account provided in the letter. On average, depending on what state you have purchased your new property, you have three months to pay the tax.
You can calculate how much stamp duty you need to pay in SA, here -> https://www.revenuesa.sa.gov.au/taxes-and-duties/stamp-duties/calculators/stamp-duty-on-conveyances-calculator-new
South Coast Realty have sold thousands of properties and will help you through every step of the process. Why not get in touch today and let us help you secure your next property!