Queensland Stamp Duty Rebate [2020 Complete Guide]
The Queensland State Government has a number of programs to help out first home buyers. One of these is the Stamp Duty Rebate.
The QLD stamp duty rebate is where a First Home Buyer can save up too $8,750 in buying costs when they buy a new or established home or a block of land.
This post has been updated for 2020, and explains how you can maximise your stamp duty rebate and what to watch out for in the fine print:
What is the First Home Buyers Stamp Duty Rebate?
Stamp duty is a tax paid by the buyer of a property.
You pay this when buying an established home or vacant land.
Stamp duty can be a substantial additional cost of buying a property so the Queensland government has decided to help first home buyers out by giving them a rebate on all or part of the cost of the stamp duty.
It’s similar to the vehicle stamp duty you pay when registering/transferring the registration if buying a car.
The rebate is based on whether you are buying an existing dwelling (i.e. one that has already been lived in) or you are building a new home.
If also changes depending on the value of the property.
What’s the difference between the different Queensland rebates, grants and scheme’s?
As of 1 January 2020, there will be three different types of incentives for first home buyers in QLD:
- The Queensland First Home Buyers Grant – a $15,000 grant if you’re building a new home or buying a brand new home. Read more here.
- The Stamp Duty Rebate – up to $8,750 if you are buying an established or newly built home priced at $500,000 or under. The rebate also works if you’re buying a block of vacant land and it tops out at saving you $7,175 if you’re buying a block of vacant land for under $250,000. Read on below.
- First home loan deposit scheme – a federal government initiative from 1 January 2020, to assist people in entering the housing market for the first time. It allows approved applicants to take out a mortgage with just a 5% deposit and avoid paying lenders mortgage insurance. This is not covered in this post so please get in touch for further details.
How do I maximise my entitlement to the QLD First Home Buyers Stamp Duty Rebate?
The Rebate increases the more you pay for your property, up to a capped amount.
You can claim the maximum Rebate if the cost of your property is just under capped amount allowed.
The stamp duty rebates are different depending on whether you are buying vacant land or an established dwelling. If buying:
- An established dwelling – the maximum Stamp Duty Rebate you are entitled to is $8,750 if you spend $499,999;
- Vacant land – the maximum Stamp Duty Rebate you are entitled to is $7,175 if you spend $249,999.
How much do I save from the QLD First Home Buyers Stamp Duty Rebate if I’m buying an existing dwelling?
The maximum QLD First Home Buyers Stamp Duty Rebate you are entitled to receive is $8,750.
The amount you get in rebate differs depending on the price of the property you are buying.
- Properties valued up to $500,000
- Rebate is $8,750 (the maximum rebate you can get).
- Properties valued at between $500,000 to $550,000:
- You’ll pay some stamp duty but the reduction in costs is at a reduced rate
- For example, a property valued at $ 505,000: the stamp duty you would normally pay is $8,925. With the rebate you would only pay $1,050 (a saving of $7,875);
- Purchase price $550,000 or more:
- Once the purchase price is $550,000 or higher, the first home buyer rebate cuts out so you’ll be charged the same stamp duty as you would if you were buying a home as a normal owner occupier.
- For example, if you’re buying a house valued at $ 550,000; you would pay $10,600 in stamp duty.
How much do I save from the QLD First Home Buyers Stamp Duty Rebate if I’m buying vacant land and building a home?
The rebate is based on the value of the vacant land you are buying (not the building, as this is covered by the $15,000 first home buyer grant).
For example, if the purchase price is:
- Up to $250,000
- The full rebate applies and you won’t be charged the stamp duty providing your application is approved
- On a land purchase of $250,000, this is an immediate saving of $7,175.
- More than $250,000
- There is a reduced rebate so you will pay some stamp duty.
- For example on a land purchase of:
- $ 260,000; the stamp duty you would normally pay is $7,525. With the rebate you would only pay $825 (a saving of $6,700);
- $ 300,000; the stamp duty you would normally pay is $8,925. With the rebate you would only pay $4,125 (a saving of $4,800);
If you are building a home, you’ll only need to consider the stamp duty on the land purchase as stamp duty isn’t payable on the value of the building contractor the quotes for finishing off the home (i.e. driveways, fencing, landscaping, solar panels etc).
What is the eligibility criteria to get the QLD First Home Buyers Stamp Duty Rebate?
- No previous ownership of residential land/property
- Have never held an interest in residential land anywhere in the world
- Have never claimed the first home vacant land concession
- You can’t have owned or part-owned any property in the past.
If you are buying with a partner who has owned property before, only the person who is the first home buyer can claim their portion of the rebate. If you own the property 50/50, you are entitled to 50% of the rebate.
2. Live in the property for at least 1 year / 12 months:
- You’ll need to live in the property for a period of at least 12 consecutive months
- AND that year needs to commence within 12 months of the purchase.
If you don’t you’ll need to be payback either part or all of your rebate.
3. Age and Citizenship / Residency
- You must be at least 18 years old at the date of the purchase
- Permanent resident in Australia / Australian citizen. If you aren’t, you are still eligible for the concession, however, there is an additional levy payable called the Additional Foreign Acquirer Duty (AFAD) which is levied at 3% of the purchase price.
Can I claim the First Home Buyers Rebate if the place I am buying is already rented?
If you are buying a home which is already rented and there are currently paying tenants with a lease, then you can let that property stay rented under the current lease end date or 6 months from settlement – whichever occurs first.
Then you can move in for your full consecutive 12 months, so you can claim your rebate.
However, you can’t claim the rebate if:
- You decide to extend or renew the lease of the current tenants past that 6 months date after settlement;
- If you buy a home which you want to live in at some point and decide to rent it out first beforehand.
What happens if the property I’m buying is occupied by an owner?
A useful bonus of the stamp duty rebate can apply where the property you’re buying is already someone’s home but they need some time to be able to leave. We’ve found that this can work especially well in 2 situations: 1. If the seller is moving into a nursing home or aged care facility and they need the money from their sale to you to allow them to buy the new property or 2. if the person you’re buying off is building their new home and they need time for the builder to finish building their new home before they can move in. If it suits all parties you can negotiate for the current owner to rent the property off you for a maximum of 6 months from the settlement date without impacting the concession grant if you then move into the property for a year.
TIP: How to take advantage of this:
Knowing this can be really advantageous in certain situations. Let’s say you’re renting and your landlord is flexible about when you leave.
Let’s also say that you’re looking to buy a property from a person who needs the money from the sale of their property BEFORE they can buy their next property. You may be able to negotiate it that they can rent your property for 5 months after settlement which gives them time to buy a new home without having to move.
This is a massive help when you’re negotiating in a competitive environment and could give you a big advantage over everyone else who’s home hunting!!
If you have any hesitation it’s best to the QLD Office of State Revenue directly on 1300 300 734 and talk with them about your personal situation.
When do you receive the Queensland First Home Buyers Stamp Duty Rebate?
The stamp duty rebate is calculated just before settlement by your solicitor or conveyancer (the settlement date is the date on which the property officially becomes yours and you pick up the keys).
Your solicitor or conveyancer calculates the costs of buying which includes stamp duty, rates etc, so your rebate is taken into account here.
If you do need to pay stamp duty, it is your solicitor’s responsibility to notify you of this and they will work out the amount you need to pay.
Your solicitor/conveyancer should tell you at least a few days prior to settlement what you owe, so you can give the funds to them or banked them in your account at least 2 business days prior to settlement.
How to apply or claim your Queensland First Home Buyers Stamp Duty Rebate
Your solicitor or conveyancer will complete these forms with you.
You can view these forms here.
My name is Victor Kalinowski and I’m a mortgage broker at Blackk Finance, with offices based in South Brisbane and Burleigh Heads. I help clients from all over Australia buy homes.
If you’re interested in getting in touch for some advice, book a call at a suitable time or call 07 3122 3628.
The information contained within this page is general in nature. It serves as a guide only and does not take into account your personal financial needs. Before you act on this information you should seek independent legal and financial advice. Copyright Blackk Finance 2020.