If you’re buying a house, you will have to pay a tax called stamp duty. This is a tax on the transfer of property which covers expenses related to changing the property title and ownership. In this article, we discuss some of the key things you need to know about stamp duty:
- How will you know the amount of stamp duty that you need to pay? It depends on the state or territory where your house is located. Some states impose a higher stamp duty than others. The cost of the property will dictate how much stamp duty you should pay. Another factor is the type of house that you want to buy. For instance, you will pay a lower stamp duty for a piece of land, as compared to a house.
- Stamp duty is calculated using rates set by the state or territory that you live in. If you are in Queensland, Victoria, Tasmania, NSW, the Northern Territory or Western Australia, stamp duty will be computed using the purchase price of the property or the estimated value, whichever is larger. On the other hand, if you live in South Australia, it is calculated according to the value of the land including the improvements or the purchase price, whichever is higher.
- Depending on the state you live in, you may be eligible for some exemptions from stamp duty. For instance, you may pay less stamp duty if the value of your house or the amount you paid for it is less than a threshold amount in your state. You may also pay less stamp duty if you’re a first home buyer. Also, you may get an exemption if you are receiving government benefits. You can ask your local Office of State Revenue if you want to know more.
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