Buying or transferring property in New South Wales usually triggers stamp duty, officially known as transfer duty. It is often one of the largest upfront costs in any property transaction.
However, the Duties Act 1997 (NSW) provides a number of exemptions and concessions that can significantly reduce or completely remove this cost if strict conditions are met. Below is a clear overview of the main stamp duty exemptions and concessions available in NSW and how they work in practice.
What Is Stamp Duty in NSW?
Stamp duty, or transfer duty, is a tax payable when ownership of property or certain assets changes hands. It applies to residential and commercial property, land, and some business transactions. The amount payable depends on the property value and the nature of the transaction. Not every transfer attracts full duty. The law recognises certain situations where charging full duty would be unfair or impractical.
First Home Buyer Exemptions and Concessions
Eligible first home buyers can receive either a full exemption or a partial concession on stamp duty under the First Home Buyer Assistance Scheme. To qualify, all buyers must be individuals rather than companies or trusts. None of the buyers may have previously owned residential property in Australia. At least one buyer must be an Australian citizen or permanent resident. The property must be used as the buyer’s principal place of residence and the buyer must move in within the required timeframe and live there continuously for the
minimum period. Property value limits apply. Full exemptions apply up to a set threshold, while partial concessions apply above that threshold up to an upper limit. Separate limits apply to vacant land intended for a first home. These thresholds change from time to time, so legal advice is critical before relying on the concession.
Transfers Between Spouses or De Facto Partners
Certain property transfers between married or de facto partners may be exempt from stamp duty, particularly where the property is or will be used as the family home. This can apply to transfers during an ongoing relationship or following separation. The exemption only applies if strict legal requirements are met, including proof of the relationship and the intended residential use of the property.
Property Transfers After Relationship Breakdown
Stamp duty is generally not payable on property transfers made under a court order, a binding financial agreement, or a qualifying agreement under NSW relationship legislation following separation or divorce. These exemptions exist to ensure that family law property settlements are not unfairly taxed. The documentation must directly support the transfer, or the exemption will not apply.
Transfers From Deceased Estates
When property is transferred to a beneficiary under a will or by intestacy, a substantial stamp duty concession usually applies. In most cases, only nominal duty is payable rather than full market-value duty. The transfer must strictly reflect the legal entitlement under the will or intestacy laws. If beneficiaries vary the distribution, additional duty may apply to the altered portion.
Self-Managed Superannuation Fund Transfers
Concessional stamp duty may apply when property is transferred between an individual and the trustee of their self-managed superannuation fund or between trustees of the same fund.
These concessions are tightly regulated. Any failure to comply with superannuation or duty requirements can result in full stamp duty, penalties, and interest.
Foreign Purchaser Surcharge Exemptions
NSW imposes a surcharge duty on certain foreign purchasers. Exemptions or concessions may apply in limited circumstances, including for specific visa holders, approved build-to- rent developments, or qualifying commercial transactions. These rules are technical and change frequently.
Charities and Non-Profit Organisations
Certain charitable, religious, and benevolent organisations may qualify for stamp duty exemptions if the transaction directly relates to their charitable purpose. Approval is not automatic and Revenue NSW will assess each transaction on its merits.
Off-the-Plan Purchases and Duty Deferral
Off-the-plan purchasers may qualify for a deferral of stamp duty, meaning payment is delayed until settlement or a specified later date. This is not an exemption. If the buyer fails to meet the required conditions, duty becomes payable in full.
Why Legal Advice Matters ?
Stamp duty exemptions and concessions are not automatic. Revenue NSW applies these rules strictly. Incorrect claims can result in reassessment, penalties, and interest, often years after the transaction. Structural errors are expensive and difficult to undo.
How Pannu Lawyers Can Help ?
Pannu Lawyers advises clients on stamp duty exposure before contracts are signed. We identify available exemptions and concessions, ensure transactions are structured correctly from the outset, and protect clients from Revenue NSW reassessments and penalties. Stamp duty mistakes are costly and often irreversible. Early advice prevents expensive surprises.