ACT Scraps Stamp Duty For Off-The-Plan Homes Under $500k

The Australian Capital Territory Government has decided to abolish stamp duty for off-the-plan properties that are valued up to $500 000 as part of a state-wide tax reform. This change was implemented on 1 July 2021 and is applicable to all types of buyers with contracts exchanged on or after this date. 

This is exciting news for ACT owner-occupiers looking to get into the ACT property market. 

Why Has The ACT Government Decided To Remove Stamp Duty?

As part of their tax reform agenda and the growing need for more residential dwellings, the ACT Government has chosen to scrap the stamp duty requirement for off-the-plan properties. This particular reform is also a way to improve the property market by providing more affordable housing across the local vicinity of Canberra.

According to the Chief Minister, Andrew Barr, the removal of inefficient taxes within the ACT will allow for a more efficient tax base and create a boost to the Territory’s economy. He also points out the importance of canceling the ACT stamp duty for properties under the $500 000 threshold with present rates reaching around $20 000 or more in surrounding states.  

Outline of duty changes

House price

Without tax reform

2021-22 Duty ($)

Change ($)

Change (%)

300,000

9,500

3,560

-5,940

-63%

400,000

15,000

6,960

-8,040

-54%

500,000

20,500

10,360

-10,140

-49%

600,000

26,250

14,680

-11,570

-44%

700,000

32,000

19,000

-13,000

-41%

800,000

37,750

24,110

-13,640

-36%

900,000

43,500

30,010

-13,490

-31%

1,000,000

49,250

35,910

-13,340

-27%

Source

The stamp duty reduction program initially began last year in response to the financial impacts of the Coronavirus pandemic. It is now being continued for more off-the-plan properties with changes being put in place on a permanent basis.  

 

How Will Homebuyers and Investors Benefit?

By abolishing stamp duty for off-the-plan properties valued up to $500 000, buyers and investors are able to secure a place and shift their expenses towards other necessary payments.

For those investing in an off-the-plan apartment or townhouse priced at $500 000, they are able to save an estimated amount of $10 360 in stamp duty. On the other hand, the ACT stamp duty will also be reduced by $1 040 for properties valued between $200 000 to $1.455 million.

Without the burden and hassle of dealing with stamp duty rates, owners can now look forward to benefiting from fairer and simpler tax duties. Regardless of whether you are looking to invest, are a first-home buyer or hoping to downsize.

To find more information regarding the ACT stamp duty conditions and to check what you may be eligible for, visit the ACT Government Revenue Office website at www.revenue.act.gov.au.

If you’re wanting to learn more about finding a home and purchasing an off-the-plan property, contact the team at iBuyNew on 1300 123 463. 

Published on 6th of August 2021 by Michelle Leftwich
Michelle Leftwich
Michelle Leftwich

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