Subject to the passing of enabling legislation the Victorian Government has announced the following changes to stamp duty and land tax:
- New Vacant Residential Property Tax - From 1 January 2018, a Vacant Residential Property Tax (in addition to land tax) will apply on dwellings vacant over six months in a calendar year. The tax will be an annual (calendar year) amount of 1% of capital improved value (not site value). Vacant residences are to be self reported to the SRO for application of the tax. Exemptions include holiday homes of persons who have their principal place of residence in Australia, city units required for work, deceased estate properties and certain temporary absences.
- First Home Owners Buyers Duty Abolishment and Restriction - For contracts signed from 1 July 2017, stamp duty (land transfer duty) will be abolished for first-home buyers purchasing a home with a dutiable value of not more than $600,000. For transfers valued between $600,001 and $750,000, duty will be applied on a sliding scale.
- Regional First Home Owners Grant Increase - For contracts signed from 1 July 2017 to 30 June 2020, the First Home Owner Grant (FHOG) will increase from $10,000 to $20,000 for new homes built in regional Victoria and valued up to $750,000. For new homes in Melbourne, the FHOG will remain at $10,000.
- Off The Plan Concession Heavily Restricted - For contracts signed from 1 July 2017, the off-the-plan duty concession will only apply to purchasers who will use the property as their principal place of residence (PPR). Effectively, if you are purchasing the property as an investment, you will not receive any savings in stamp duty for buying 'off-the-plan'.
Please contact us if you are considering purchasing property and would like further information about whether the proposed changes will affect you.
T 03 5226 8595