Mozo guides

What is stamp duty, and how does it work?

Man about to pay stamp duty on laptop for his swish new house

If you’re in the home buying process, then you’ve probably heard about stamp duty. Stamp duty can be a significant home-buying cost to budget – and unfortunately, your home loan does not cover it. How much stamp duty costs varies by location, property value, and buyer.

Let’s get into what you need to know.

What is Stamp Duty on Home Loans?

Stamp duty (also known as transfer duty) is a one-off property tax levied by state and territory governments on home purchases. Stamp duty is paid by the buyer on both owner-occupier and investor homes. 

How much is stamp duty?

Stamp duty differs for each state, property, and home buyer because it’s a state-based government tax. However, it can cost tens of thousands of dollars.

For instance, Mozo’s stamp duty calculator shows that a property in NSW bought for $500,000 as someone’s primary residence costs $17,235 – so long as they aren’t a first home buyer

However, a Victorian home buyer getting a property at that same price would have to pay $21,970. In Queensland, their stamp duty would cost only $8,750.

How is stamp duty calculated?

Stamp duty is calculated using the property value, the buyer’s history, and the local state or territory government rules. More expensive properties have higher stamp duty costs. 

However, first home buyer grants mean that many Australians pay low or no stamp duty, up to a certain threshold, depending on the property type. You can check your eligibility using our first home buyer stamp duty calculator

Otherwise, if you’ve owned property in the last ten years, you’re on the hook for stamp duty.

Exemptions and Concessions

Since stamp duty is varied depending on the state or territory government, exemptions and concessions are up to the government of the properties location. 

New South Wales

  • First Home Buyer Assistance Scheme: Exemptions for new and existing properties up to $800,000 and concessional rates for properties over $800,000 and less than $1,000,000.
  • First Home Buyer Choice: Allows eligible first-time buyers to choose between paying stamp duty or an annual property tax.


  • First Home Buyer Duty Exemption or Concession: Exemptions for properties up to $600,000 and concessional rates for properties over $600,000 up to $750,000.
  • Principal Place of Residence Concession: Concessional rates for properties valued up to $550,000.


  • First Home Concession: Concessional rates for properties under $550,000.
  • Home Concession: Concessional rates for properties valued up to $350,000.

Western Australia

  • First Home Owner Rate of Duty: Concessional rates for properties where the combined value of land and property value of under $530,000.
  • Off-the-Plan Duty Rebate: At property prices of $650,000 or less, 100 per cent of the duty paid or payable which is capped at $50,000.

South Australia

  • Stamp Duty Relief for First Home Buyers: Can reduce stamp duty to zero for properties up to $650,000 (or $400,000 for vacant land). Partial reduction when under $700,000 (or $450,000 for vacant land).


  • First Home Buyer Duty Concession: $600,000 until 30 June 2024 (T&Cs apply).
  • Pensioner Duty Concession: A 50% discount on stamp duty for eligible pensioners on property values of $600,000 or less up until 30 June 2024.

Australian Capital Territory

  • Home Buyer Concession Scheme: An exemption from paying stamp duty for unit-titled apartment and townhouses worth up to $700,000.

Northern Territory

  • First Home Owner Discount: A discount of up to $18,601 on stamp duty for first-time buyers with a property value of $650,000 or less.
  • Principal Place of Residence Rebate: A rebate for non-first home owners of up to $7,000 for the purchase of a principal place of residence on the purchase of a new home or the land where a new home is being built.

Impact on Home Loans

Stamp duty is a significant cost that home buyers need to consider when purchasing a property, as it can have a substantial impact on home loans and the overall purchasing process. 

This additional expense can significantly impact a buyer's borrowing and purchasing power. For example, if a buyer has saved $100,000 for a deposit, but the stamp duty on their desired property is $20,000, they may need to either borrow more money - or look for a less expensive property. The added cost of stamp duty can effectively reduce the amount a buyer can spend on the property itself, which may limit their options in the market.

Buyers without access to a concession will need to budget for stamp duty alongside other costs, such as the deposit, legal fees, and mortgage registration fees. Failing to account for stamp duty can lead to difficulty in securing the necessary funds to complete the purchase. Some buyers may need to save for a longer period or explore alternative financing options to cover the additional expense of stamp duty.

How to Pay Stamp Duty

In most cases, the payment of stamp duty is arranged through a solicitor or conveyancer who is responsible for handling the legal aspects of the property transaction.

The solicitor or conveyancer will calculate the amount of stamp duty payable based on the purchase price of the property and the applicable stamp duty rates in the state or territory where the property is located. They will then coordinate with the buyer to make sure that the necessary funds are available for payment at settlement. 

It’s important to keep the deadline in mind as late payments may incur penalties or interest charges. 

When is stamp duty payable?

When you pay stamp duty depends on the state or territory. Usually, buyers pay stamp duty between 1 to 3 months after signing the contract of sale and completing the home loan settlement

Here are a few of the timeframes:

  • In NSW, home buyers must pay stamp duty within 3 months of settlement.
  • In VIC and QLD, home buyers must pay stamp duty within 30 days of signing the contract of sale.
  • In SA, home buyers must pay stamp duty before getting registered on the certificate of title (i.e. before settlement). 

Some eligible home buyers may be able to defer their stamp duty payment for 12 months, but this isn’t the case everywhere. Check the rules of your local state or territory government.

Stamp duty FAQs

Who pays stamp duty?

The buyer pays stamp duty unless they are eligible for an exemption. See first homeowner grants

The seller does not pay stamp duty. Instead, the seller might have to pay capital gains tax. 

Can stamp duty be added to a mortgage?

No, stamp duty is a separate cost to your home loan.

Can stamp duty be paid in instalments?

No, you cannot pay stamp duty in instalments. You must pay in full after signing the contract of sale (or before, depending on where you live).

What are stamp duty rates?

A stamp duty rate is the tax rate charged per dollar of the property value. Tax rates vary by Australian state and territory and are often tiered. 

For example, the first $15k may be charged at  $1.25 per $100, then $1.50 per $100 for the next $15k, and so forth.

Who do you pay stamp duty to?

You pay stamp duty to your state revenue office.

Is stamp duty tax deductible? Does it have GST?

Stamp duty is not tax deductible, even for property investors. However, there are ways you can lower capital gains tax when you sell. 

Stamp duty is not liable for GST in Australia.

Evlin DuBose
Evlin DuBose
Senior Money Writer

Evlin, RG146 Generic Knowledge certified and a UTS Communications graduate, is a leading voice in finance news. As Mozo's go-to writer for RBA and interest rates, her work regularly features in Google's Top Stories and major publications like

Cameron Thomson
Cameron Thomson
Money writer

Cameron, with a background in radio and degrees in creative writing and history, is RG146 certified in Generic Knowledge. He tracks savings rates and trading platforms, aiding Aussie consumers in smart investments.