Understanding Stamp Duty on Refinancing & Property Transfers
How it works
The fundamental rule of stamp duty is simple: duty is triggered by a change of beneficial ownership of dutiable property. This single principle determines whether stamp duty applies to every type of refinancing and transfer scenario.
Refinancing — whether with the same lender or a different one — does not change who owns the property. You're changing your financing arrangement, not the ownership. Because there is no transfer of beneficial ownership, no stamp duty applies. The only government fees are mortgage registration fees charged by the Land Titles Office (to register the new mortgage and discharge the old one).
Title transfers — adding or removing a name, transferring to a spouse, or selling to a family member — do involve a change of beneficial ownership. The person gaining an interest in the property is acquiring dutiable property, and the revenue office will assess stamp duty on the market value of the share being transferred. However, every state provides exemptions for certain transfers: spouse/partner transfers for the principal residence, court-ordered relationship breakdowns, and deceased estate transfers are the most common exemptions.
The critical trap for related party transfers is the market value rule. Unlike arm's-length purchases where duty is based on the contract price, related party transfers are always assessed on the property's current market value — even if no money changes hands. This means a gift of property attracts the same stamp duty as a full-price sale.
When to use this calculator
- You're refinancing your mortgage and want to confirm no stamp duty applies
- You're adding a spouse or partner to the property title after marriage or to share ownership
- You're removing a name from the title after separation, divorce, or a co-owner buyout
- You want to transfer property to your spouse as part of estate or tax planning
- You've inherited property and want to understand the costs of transferring it into your name
- You're considering a related party sale (e.g. selling to a child or sibling) and need to understand the market value rule
- You're a conveyancer or mortgage broker looking for a quick reference on transfer duty rules
Key concepts
- Beneficial Ownership
- The right to enjoy the economic benefits of property ownership (rent, capital gains, use). Stamp duty is triggered when beneficial ownership changes hands — not when a mortgage is refinanced, because the borrower remains the beneficial owner throughout.
- Market Value Rule
- For transfers between related parties (family, associated entities), the revenue office assesses stamp duty on the property's current market value, regardless of the price paid. This prevents duty minimisation through below-market-value sales or gifts. A formal valuation may be required.
- Spouse/Partner Exemption
- All Australian states exempt transfers between married or de facto partners from stamp duty, provided the property is the principal place of residence. Court-ordered property settlements (under the Family Law Act) are also exempt regardless of property type. The exemption must usually be applied for with supporting documentation.
- Deceased Estate Exemption
- Property transferred from a deceased person's estate to a beneficiary named in their will (or under intestacy rules) is exempt from stamp duty in all states. A transfer registration fee still applies. This exemption covers the initial transfer only — any subsequent sale or transfer by the beneficiary is subject to standard duty.
- Transfer Registration Fee
- A government fee charged by the Land Titles Office to update the property title when ownership changes. This fee applies even when stamp duty is exempt (e.g. spouse transfers, inheritance). The amount varies by state and, in some states, by property value.
- Mortgage Registration & Discharge Fees
- When refinancing with a new lender, the old mortgage must be discharged (removed from the title) and a new one registered. Each action attracts a fee from the Land Titles Office. These are flat fees that vary by state, typically $125–$195 each.
Worked example — Adding a spouse to a $900,000 property in NSW
Sarah owns a $900,000 home in Sydney as the sole owner. She recently married Tom and wants to add him to the property title as a 50% co-owner.
Scenario 1: The property is their principal place of residence
| Item | Amount |
|---|---|
| Stamp duty on 50% share ($450,000) | $0 (exempt) |
| Transfer registration fee | $2,401 |
| Total cost | $2,401 |
Because the property is the principal place of residence and the transfer is between spouses, the full spouse exemption applies in NSW. Sarah and Tom only pay the transfer registration fee.
Scenario 2: The property is an investment property (not PPR)
| Item | Amount |
|---|---|
| Stamp duty on 50% share ($450,000) | $14,440 |
| Transfer registration fee | $2,401 |
| Total cost | $16,841 |
Since the property is not the principal residence, the spouse exemption does not apply. Stamp duty is calculated on the market value of the 50% share being transferred ($450,000), using the standard NSW duty schedule.
Key takeaway: The same transfer can cost $2,401 or $16,841 depending on whether the property is the principal residence. This is why it's critical to check exemption eligibility before proceeding.
Frequently Asked Questions
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