How to Calculate Stamp Duty on Property Purchase in Australia

by Ranjan Khatak Director and founder of Your Finance Adviser

When people are looking to purchase land or real estate in Australia, they may have heard about stamp duty tax or interest, also known as transfer duty. But what does it concern them?

In simple terms, Stamp duty is a tax collected by the government from buyers on every real-estate, house or property purchase. The property type includes apartments, commercial or residential property, family homes. A person buying such properties has to pay stamp duty, which usually depends upon the state or territory or the place where he's buying.

On average, an Australian spends thousands of dollars just on stamp duty on top of a mortgage. That is where a stamp duty interest calculator is helpful to calculate and estimate finances.

Factors to Understand Stamp Duty Calculation

When it comes to calculating stamp duty interest, it involves a few factors to get an idea of what amount a person has to pay. These are:

Location of Property: Stamp Duty is a tax collected by state and territory government on a property's sale price or its current market value. However, each state and territory have their own set of rules, rates, price brackets and exemptions for stamp duty collection. The stamp duty amount changes from state to state so does the time to pay it.

New South Wales (NSW)- three months within signing contract of property purchase.
Victoria (VIC) - 30 days within the settlement of the new purchase.

Western Australia (WA) - 30 days after a duty assessment duty is issued.

Investment type: The property purchase amount plays a pivotal role in calculating stamp duty since each state has different brackets for house prices that determine how much a person can owe. For instance, for NSW: if the property sale price lies between $0 to $14,000, the transfer duty will be $1.25 for every $100 (the minimum is $10).

Stamp duty Exemption: There is good news for first-time buyers. Some Australian states and territories allow stamp duty exemptions and concessions for first-time home buyers or seniors and pensioners. A significant concession is done on the value of the property sale price or the buyer's annual income.

Although many states offer concessions, there are still a few states that don't have such policies. So, in such a situation, consult a first-time buyer mortgage broker. He will help determine the eligibility criteria and the rules and price brackets of each state of Australia.

Stamp Duty Calculator

While buying a property or house and wanting to quickly check the stamp duty fee on the property's current market price, then use Anz stamp duty calculator. Online calculators are handy and can be accessed from anywhere from smartphones. Moreover, it helps estimate weekly, monthly or yearly budgets as per duty fees.

Conclusion

Many buyers are looking to save money for the mortgage deposit amount, and the extra stamp duty costs could come as an unexpected cost. Therefore, look into the costs of a home within a state or territory before purchasing and talk to an expert like Mr Rajan Khatak — leading Mortgage Broker Five Dock. He has helped many customers to get the best mortgage deals within their budget.

As a leading finance advising company, Your finance Adviser delicately helps with your home buying, investing or refinancing needs. Contact today for more details.