What is Transfer Duty?
Whenever a substantial asset changes hand in Queensland the Revenue office levies a Transfer Duty on the party obtaining the benefit of the Asset.
In a property transaction this is the Buyer.
This was previously known as Stamp Duty.
Prior to electronic settlements of property, assessors would us a literal stamp on the original contract.
This stamp noted the Revenue Office transaction number, date and amount of Duty payable to the Government. Hence the expression Stamp Duty.
Although the physical stamp has been largely dispensed with, Duty is still payable on most property transactions.
Land, Houses and Real Property Duty
Whenever you purchase real property, that is land, if it has a residence on it or not, is subject to Transfer Duty.
Land-holdings commonly include:
+ an interest in land, other than
+ a security interest
+ an interest in a trust
+ anything fixed to the land (e.g. pipelines, plant and equipment), whether or not the landholder has an interest in it
+ an interest in land, including anything fixed to the land, that is the subject of a purchase or sale agreement
+ the land-holdings of a subsidiary of the landholder
+ land-holdings held on trust by the landholder, where the landholder (or a subsidiary of the landholder) is a beneficiary of the trust
+ land-holdings held by the landholder for a partnership, regardless of the interest that the landholder has in the partnership.
Who Pays What?
The purchaser of the asset, or acquirer, is the party responsible for the payment of duty to the Queensland Revenue Office. Although all transactions must be assessed and lodged, not all transactions actually have a monetary value payable. Confused yet?
First Home Buyers
If you have never owned real property, that is a house or land, anywhere in the world you may be eligible for the First Home Buyers Exemption. If however you have not owned land, but the party you are purchasing has, such as your spouse, then you are eligible whilst they pay transfer duty on their share.
The First Home Buyers Exemption is only applicable on properties up to $700,000.00. Properties over this will attract the Home Concession only.
If you are both living in the property as your principal place of residence then you may received the exemption whilst they received the concession.
If you are living in the property, but they are not, then their share will be assessed as an investor with nil concessions. See…there are a few different combinations but don’t worry…our team knows what they are doing.
Home Concession
If you have owned property before but plan on living in the one you are purchasing, then you may be eligible for the Home Concession. This is a reduced rate of transfer duty and payable at settlement.
Additional Foreign Investor Acquirer Duty – AFAD
Additional Foreign Investor Acquirer Duty (AFAD) is payable if one of, or both of the purchasing entities are Non-Australian residents or entities.
AFAD can add substantial costs to your acquisition however there are some exemptions for New Zealanders and Permanent Residents. If this affects you then please speak with our team and we can assist with the matter.
However, if you are a foreign investor, you will need to seek approval from the Foreign Investment Review Board (FIRB) prior to entering into a contract for the purchase of a relevant property.
This is a separate process and attracts additional Federal Government Fees.
Relax…We Got You
Regardless if you are a first home buyer or seasoned investor, our team can walk you through the process and ensure that your duty obligations are met.
More detailed information can be found on the Queensland Revenue Office website.
