How Stamp Duty Works in Australia

What Is Stamp Duty?

Stamp duty — officially called transfer duty in most Australian states — is a government tax charged on property transactions. It applies whenever real estate changes hands, whether you are buying a house, apartment, vacant land, or commercial property. The tax is calculated as a percentage of the property's purchase price (or market value, whichever is higher) and is payable by the buyer, not the seller.

Every state and territory in Australia sets its own stamp duty rates and rules, which means the amount you pay can vary dramatically depending on where you buy. The tax is typically due at settlement — the point at which the property legally transfers from the seller to the buyer — and must be paid to the relevant state or territory revenue office.

Stamp duty is one of the largest upfront costs of buying property in Australia. On a median-priced home, it can easily add tens of thousands of dollars to your purchase costs. Understanding how it works is essential for budgeting, especially if you are a first home buyer trying to work out how much you really need to save.

How Is Stamp Duty Calculated?

Stamp duty in Australia uses a marginal bracket system, similar in concept to how income tax works. The property's purchase price is divided into portions, and each portion is taxed at a progressively higher rate. You do not pay the top rate on the entire purchase price — only on the amount that falls within each bracket.

Each state publishes a rate schedule that specifies the duty payable as a base amount plus a rate per $100 on the excess above the lower bracket threshold. For example, in NSW, a property valued between $364,001 and $1,118,000 attracts a base duty of $13,657 plus $4.50 for every $100 over $364,000. This means higher-value properties pay more duty in absolute terms, but the effective rate increases gradually rather than jumping sharply.

The specific brackets, base amounts, and per-$100 rates differ in every state and territory, which is why using a calculator tailored to your state is important. Factors such as whether you are a first home buyer, a foreign purchaser, or buying off-the-plan can also change the amount you owe.

Stamp Duty Rates by State

The table below summarises the key stamp duty parameters for each Australian state and territory. Rate ranges show the lowest and highest per-$100 rates that apply to residential property purchases. The foreign surcharge is an additional percentage levied on top of the standard duty for overseas buyers.

Rates shown are for standard residential property purchases as at FY 2025-26. Some states apply different schedules for commercial property, vacant land, or premium properties above certain thresholds.

Worked Example: Stamp Duty on a $750,000 Property in NSW

To illustrate how the bracket system works in practice, here is a step-by-step calculation for a $750,000 residential property in New South Wales, assuming the buyer is not a first home buyer and is an Australian resident.

This is approximately 3.7% of the purchase price. The effective stamp duty rate increases with property value because higher brackets carry higher per-$100 rates.

First Home Buyer Concessions

Every state and territory in Australia offers some form of stamp duty relief for first home buyers, although the eligibility criteria, thresholds, and type of relief vary considerably. Some states provide a full exemption below a certain purchase price, while others offer a sliding-scale concession or a separate grant program.

These concessions can save first home buyers thousands — or even tens of thousands — of dollars in upfront costs. If you are buying your first home, checking your eligibility for these programs should be one of the first things you do when budgeting.

Thresholds and eligibility criteria are subject to change. Always check with your state revenue office for the latest information before making a purchase decision.

Foreign Buyer Surcharges

Six of Australia's eight states and territories impose an additional stamp duty surcharge on property purchases by foreign buyers (non-citizens and non-permanent residents). This surcharge is calculated as a flat percentage of the purchase price and is payable on top of the standard stamp duty amount.

The surcharge rates as at FY 2025-26 are: NSW 9%, VIC 8%, QLD 8%, WA 7%, SA 7%, and TAS 8%. These surcharges can add substantial cost — on a $1 million property in NSW, a foreign buyer would pay an additional $90,000 in surcharge duty alone.

The Northern Territory and ACT do not charge a stamp duty surcharge on foreign buyers. However, the ACT levies a higher annual land tax rate on properties owned by foreign persons instead, so the cost is spread over time rather than charged upfront.

For property investors, stamp duty forms part of the CGT cost base. To understand how your marginal tax rate affects capital gains when you sell, you can calculate your marginal tax rate.

When Do You Pay Stamp Duty?

Stamp duty is generally payable at settlement, which is the date the property officially transfers from the seller to the buyer. In most cases, settlement occurs within 30 to 90 days after the exchange of contracts, depending on the terms of the sale agreement and the state you are purchasing in.

Your solicitor or conveyancer will typically handle the stamp duty payment on your behalf as part of the settlement process. The duty is lodged electronically with the state revenue office, and the transaction cannot settle until the duty has been paid. Digital lodgement is now standard across all states, making the process faster and more straightforward than it once was.

Some states allow instalment payment plans in certain circumstances. In NSW, Revenue NSW may approve instalment arrangements for buyers experiencing financial hardship. In Victoria, first home buyers purchasing off-the-plan properties can defer their duty until the earlier of settlement or 12 months after the contract date. Check with your state revenue office for specific options.

What Affects How Much Stamp Duty You Pay?

Five key factors determine the stamp duty payable on your property purchase. Each can significantly change the final amount, so it pays to understand them before you start looking.

If you're buying an apartment, don't forget to budget for ongoing strata fees — they are a significant recurring cost on top of your upfront stamp duty.