How much is stamp duty in WA?
Understanding Stamp Duty in Western Australia
What is Stamp Duty?
Stamp duty, also called transfer duty, is a tax that must be paid when buying a property in Western Australia. It’s something most people have to pay, and while it might seem confusing, understanding how it works can make the process easier.
Why is it called "Stamp Duty"?
In the past, when people paid this tax, their documents were stamped to show that the payment was made. Today, stamp duty is still a big part of the money the Western Australian Government collects, helping to pay for important public services.
Stamp duty applies to most property purchases, including houses, apartments, commercial buildings, and even empty land. It must be paid within one month of buying the property. If it is paid late, there may be extra fees, so most people pay it when they settle the purchase.
How is Stamp Duty Calculated?
The amount of stamp duty you pay depends on:
The price or market value of the property (whichever is higher).
The type of property you are buying.
Whether you qualify for a discount or exemption.
The more expensive the property, the higher the percentage of tax. Here’s how the rates work:
Up to $120,000 – 1.90% of the property’s value
$120,001 to $150,000 – $2,280 plus 2.85% of the amount over $120,000
$150,001 to $360,000 – $3,135 plus 3.80% of the amount over $150,000
$360,001 to $725,000 – $11,115 plus 4.75% of the amount over $360,000
More than $725,000 – $28,453 plus 5.15% of the amount over $725,000
Example:
A couple are buying a home worth $500,000. Since they don’t qualify for any discounts, their stamp duty is calculated like this:
The first $360,000 costs $11,115.
The remaining $140,000 is taxed at 4.75%, which is $6,650.
Their total stamp duty is $17,765.
Who Gets a Discount or Exemption?
Some buyers don’t have to pay stamp duty, while others only pay a reduced amount.
In May 2024, the Western Australian Government introduced new rules to help first-home buyers:
If you buy your first home under $450,000, you don’t have to pay stamp duty.
If your first home is between $450,001 and $600,000, you get a discount.
If you buy an off-the-plan apartment (a unit that is still being built) before June 30, 2025, you may also qualify.
If you are buying farmland from a family member, you might be eligible for the Family Farm Exemption.
If you buy vacant land under $300,000, you don’t pay stamp duty. If the land is between $300,001 and $400,000, you get a reduced rate.
However, foreign buyers (people who aren’t Australian citizens or permanent residents) may have to pay extra, so it’s important to check before buying.
Planning for Stamp Duty
Unless you qualify for an exemption, stamp duty is a cost you must budget for when buying a home. Since it can be a large amount, it’s a good idea to plan ahead so it doesn’t catch you by surprise.
To make budgeting easier:
Use an online calculator to estimate how much you will need to pay.
Include the cost in your upfront budget so you’re not borrowing money just to cover stamp duty.
Speak to a professional (such as a mortgage broker, solicitor, or conveyancer) to get advice about your situation.
Understanding stamp duty can help make the process of buying a home much smoother!
