How Off-the-Plan Stamp Duty Concessions Work
How it works
When you buy a property "off the plan" — signing a contract before construction is complete — several Australian states offer stamp duty concessions to encourage new housing supply. The savings can be substantial: tens of thousands of dollars compared to buying an equivalent established property.
The mechanism varies by state. Victoria reduces the dutiable value by deducting part or all of the construction component, so you pay duty only on the land share. Western Australia applies a percentage reduction directly to the calculated duty amount, with pre-construction properties receiving up to a 100% waiver. Tasmania offers a straightforward 50% reduction in duty for eligible apartments and units.
New South Wales takes a different approach — it doesn't reduce the duty amount, but instead allows you to defer payment for up to 12–15 months after contract exchange, giving you more time to arrange finances. Other states (QLD, SA, NT, ACT) do not currently offer specific OTP concessions, though standard first home buyer concessions still apply to new builds.
These concession programs are temporary. Most have scheduled expiry dates (typically mid-2026) and may be extended, modified, or allowed to lapse depending on government policy. Always check current eligibility before relying on a concession.
When to use this calculator
- You're considering an off-the-plan purchase and want to see how much you'd save compared to buying established
- You're comparing OTP concessions across states to understand where the biggest savings are
- You need to know the land vs construction split required for Victoria's concession calculation
- You want to check whether a concession has expired or is about to — each state has different end dates
- You're a first home buyer wondering if you can combine OTP concessions with FHB exemptions (you usually can)
- You're weighing up whether to buy pre-construction vs under-construction — WA treats these differently
Key concepts
- Dutiable value
- The amount on which stamp duty is calculated. For standard purchases, this is the purchase price or market value (whichever is greater). For OTP purchases in Victoria, the dutiable value is reduced by deducting the construction component, so you only pay duty on the land share.
- Land component vs construction component
- An off-the-plan contract price is split into two parts: the land value (your share of the underlying land) and the construction cost (the building work). This split is critical in Victoria, where the concession deducts a percentage of the construction component. Your developer or conveyancer provides this breakdown — it's usually specified in the contract or in a statutory declaration.
- Construction deduction percentage (VIC)
- In Victoria, the deduction depends on the building type and construction stage. Low-rise strata properties receive a 100% construction deduction (duty on land value only). High-rise strata and non-strata deductions range from 45% to 100%. The expanded concession (Oct 2024 – Oct 2026) further increased the deduction for many property types.
- Duty waiver vs duty deferral
- A waiver (VIC, WA, TAS) means you genuinely pay less stamp duty — the saving is permanent. A deferral (NSW) means you owe the same amount but get extra time to pay. Deferrals help cash flow but don't reduce your total costs. This is an important distinction when comparing states.
- Concession expiry dates
- Most OTP concessions are temporary government programs. Victoria's expanded concession runs until October 2026, WA's waiver until 30 June 2026, and Tasmania's 50% reduction until 30 June 2026. Contract exchange date (not settlement date) typically determines eligibility. If you're close to an expiry date, confirm with your conveyancer.
Worked example — $680,000 off-the-plan apartment in Victoria
Sarah is buying a $680,000 off-the-plan apartment in Melbourne (low-rise strata, pre-construction). Her contract specifies a land component of $220,000 and a construction component of $460,000. She is not a first home buyer.
Without OTP concession (standard established property rate):
| Amount | |
|---|---|
| Purchase price | $680,000 |
| Stamp duty (standard VIC rates) | $35,990 |
With OTP concession (100% construction deduction for low-rise strata):
| Amount | |
|---|---|
| Purchase price | $680,000 |
| Construction deduction (100%) | −$460,000 |
| Dutiable value (land only) | $220,000 |
| Stamp duty on $220,000 | $7,660 |
| Total saving | $28,330 |
By buying off the plan, Sarah saves $28,330 — a 78.7% reduction in stamp duty. The concession effectively means she pays duty on only the land share of the purchase.
If Sarah were also a first home buyer (property under $750K), she could combine the OTP concession with Victoria's FHB duty reduction for further savings — potentially paying $0 in stamp duty on the reduced dutiable value.
Frequently Asked Questions
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