Understanding Victorian Stamp Duty Concessions: A Guide for Homebuyers and Investors

Stamp duty, or transfer duty, is a tax the Victorian Government imposes on property transactions. The amount payable depends on the property’s value and whether any exemptions or concessions apply. Fortunately, several concessions exist to help eligible buyers reduce their stamp duty liability. These concessions vary depending on the type of property, its purchase price, and the buyer’s intended use of the property.

Off-the-Plan Concessions

The off-the-plan concession applies to contracts signed on or after 1 July 2017. This concession benefits buyers who intend to live in the property as their principal place of residence by allowing them to pay duty only on the improved land value, non-deductible costs, and the portion of construction completed at the contract date, rather than the full contract price.

Off-the-Plan Land and Building Packages

This concession applies when a buyer purchases vacant land and enters into a contract to construct a new home (house, townhouse, apartment, or unit) on that land.

Off-the-Plan Refurbished Lots

For properties within a refurbished building, the off-the-plan concession is available if the refurbishment is incomplete at the contract date. However, the concession only applies to the first sale after the plan of subdivision is registered and does not extend to later transactions or sub-sales.

Temporary Off-the-Plan Concession

For contracts signed from 21 October 2024, a temporary off-the-plan concession applies to dwellings within a strata subdivision, provided the purchase occurs within 12 months from the contract date.

First Homeowner Concessions

First Homeowners with a Family

Eligible first homeowners with a family can access stamp duty relief based on the value of the property:

• A full exemption applies to properties valued at $150,000 or less.
• A concessional rate is available for properties valued up to $200,000.
  

Pensioner and Concession Cardholder Duty Reduction

Eligible pensioners and concession cardholders may receive a one-off stamp duty reduction when purchasing a home. This reduction can also be combined with first-home buyer exemptions and concessions where applicable. Importantly, the reduction applies to all qualifying parties involved in the transaction.

Principal Place of Residence (PPR) Concession

The Principal Place of Residence (PPR) concession applies to buyers intending to occupy the property as their main home. To qualify:

• The buyer must reside in the home for at least 12 months, commencing within 12 months of settlement.
• If multiple buyers are on the title, at least one must meet the residency requirement, though it does not need to be the same person for the entire 12-month period.
  

Young Farmers Duty Exemption and Concession

Young farmers purchasing farmland in Victoria may be eligible for significant duty relief:

• A full duty exemption on the first $300,000 for farmland valued under $600,000.
• A partial duty concession for farmland valued between $600,000 and $750,000.
• Eligibility is restricted to buyers under 35 years of age.
  

Conclusion

Navigating the complexities of stamp duty and maximising available concessions requires careful consideration. Whether you are purchasing a home, investing in property, or acquiring farmland, understanding these exemptions can significantly reduce the overall cost of your transaction. 

The above is not legal advice and is general information only.