What Is Stamp Duty and How Is It Calculated?
Stamp duty — formally known as transfer duty in most Australian states — is a state government tax levied on property transactions. When you buy residential or commercial real estate, you pay stamp duty to the state government where the property is located. The amount depends on three factors: the purchase price, the state, and whether you qualify for any concessions (particularly for first home buyers).
Stamp duty is calculated using a tiered bracket system, similar to income tax. You pay progressively higher rates on higher portions of the purchase price. On a $750,000 property in NSW, for example, you pay nothing on the first $14,000, then escalating rates up to 4.5% on amounts between $351,000 and $1,168,000. The result is an effective rate of around 2.9% — meaning approximately $21,500 in stamp duty.
Stamp Duty by State: 2024–2025 Rates
Stamp duty rates vary dramatically between states. Understanding the differences is particularly important for investors who may have flexibility in which state to purchase, and for interstate movers who need to budget accurately.
NSW — New South Wales
NSW has a seven-bracket system with rates from 1.25% (under $17,000) to 7% (above $3.5M). For properties between $351,000 and $1,168,000 — the range covering most Sydney transactions — the marginal rate is 4.5%. First home buyers receive a full exemption below $800,000 and a tapered concession to $1,000,000. NSW Revenue administers duty through the OSR portal. Payment is due within 3 months of settlement.
VIC — Victoria
Victoria uses a four-bracket system with a principal rate of 6% on properties between $130,000 and $960,000, dropping to 5.5% above that. First home buyers receive a full exemption on established homes up to $600,000 and a tapered concession to $750,000. New builds by first home buyers are exempt up to $1,000,000. The State Revenue Office Victoria (SRO) assesses duty based on the greater of purchase price or market value.
QLD — Queensland
Queensland's rates are generally lower than NSW and VIC. Properties below $5,000 pay no duty. The main residential bracket ($75,000–$540,000) attracts a 3.5% marginal rate. QLD offers a first home concession that effectively reduces duty on properties used as a principal place of residence — check the Queensland Revenue Office for current thresholds and eligibility conditions.
WA — Western Australia
WA has a six-bracket system with relatively competitive rates for mid-range properties. The 4.15% marginal rate applies from $250,000 to $500,000. First home buyers receive a full exemption below $430,000 and a tapered concession to $530,000 — the lowest exemption threshold of the major states.
SA — South Australia
SA uses a nine-bracket system. The 5% marginal rate applies from $300,000 to $500,000, rising to 5.5% above $500,000. Unlike other states, SA does not offer a dedicated stamp duty concession for first home buyers, though the $15,000 First Home Owner Grant applies to new builds.
ACT — Australian Capital Territory
The ACT is progressively transitioning away from stamp duty toward a broad-based land tax. For standard buyers, the ACT uses a seven-bracket system. The Home Buyer Concession Scheme can reduce or eliminate duty for eligible first home buyers (income-tested, with a household income cap). The ACT Revenue Office administers the scheme.
First Home Buyer Stamp Duty Concessions
Every state and territory offers some form of support for first home buyers, though the generosity and structure vary significantly:
- NSW: Full exemption below $800K, tapered concession to $1M. No duty applies on vacant land below $400K (tapered to $500K).
- VIC: Full exemption on established homes below $600K, tapered to $750K. For new builds, full exemption below $1M.
- QLD: First home concession — significant reduction on principal place of residence purchases. Verify current threshold with QLD Revenue.
- WA: Full exemption below $430K, tapered to $530K.
- TAS: 50% concession on established homes up to $600K.
- NT: 50% discount on duty for eligible FHBs up to $549K.
- ACT: Income-tested Home Buyer Concession Scheme — can eliminate duty entirely for qualifying buyers.
- SA: No specific stamp duty concession, but $15K First Home Owner Grant for new builds.
Budgeting for Property Purchase Costs
Stamp duty is often the largest single purchase cost after your deposit, but it is not the only upfront cost to budget for. A full budget for a $750,000 property in NSW for an owner-occupier would include:
- 20% deposit: $150,000
- Stamp duty: ~$29,000
- Conveyancing: $2,000
- Building and pest inspection: $800
- Loan establishment fee: $500
- Other (title search, mortgage registration, moving): ~$1,000
- Total funds needed: ~$183,300
If your deposit is less than 20%, you will likely also pay Lenders Mortgage Insurance (LMI), which can add $10,000–$30,000 depending on your loan amount and LVR.