What is Stamp Duty?

What is stamp duty?

Stamp Duty is a tax that is also known as Government Charges.

When talking about specific transactions such as purchasing an established house or vacant land you will find this tax is applied to the total purchase price when the settlement occurs upon an item being purchased here in Australia. This tax is applied by the relevant State Government to which the transaction takes place and the total amount of stamp duty varies depending on the final purchase price.

In some states and territories there are concessions such as for First Home Buyer’s which can lower the final amount payable making it a more affordable exercise for the younger generation to get their foot in the door.

Even though each state and territory has its own method of calculating the amount of charges applicable, the fee is calculated based on a simple scaled formula. For example, the higher the final purchase price the higher the stamp duty amount payable by the purchaser. The stamp duty fee is payable upon the time of the interested transaction settling along with other fees like Lenders Mortgage Insurance.

If you would like to have a look at stamp duty charges for South Australia don’t hesitate to check out the Revenue SA website, alternatively don’t hesitate to pick your mortgage brokers  brain as they will be able to help and assist you with working out the final charges you will be up for.

Other taxable transactions in Australia can include but not limited to:

·       Motor vehicle transfers (purchases)

·       Motor vehicle registration

·       Insurance policies

·       Leases

·       Home mortgages

·       Transfers of property – this can included real estate, businesses or certain shares

·       Hire purchase agreements

The rate of stamp duty varies according to the type of transaction and also the total final value of the transaction involved payable at time of change of ownership.

If you have any queries or a question regarding specific information around Stamp Duty or home loans in general, don’t hesitate to get in touch with our friendly team  on 08 8344 9933 or email Jessica at jessica@financeprospects.com.au  to find out more about the options available to you.