ByLawyers News and Updates

First home buyers – NSW

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New caps and rules over first home buyers schemes in New South Wales come into force on 1 July 2023.

The newly elected New South Wales government has announced extensions to the First Home Buyer Assistance (FHBA) scheme. First home buyers purchasing a new or existing property valued at less than $800,000 will pay no transfer duty. The cap increases on 1 July 2023 from $650,000. First home buyers who buy a new or existing property valued between $800,000 and $1,000,000 can apply for a concessional transfer duty rate. The qualifying range increases on 1 July 2023 from the previous band of between $650,000 and $800,000.

Purchasers who exchange on or after 1 July 2023 will receive the benefit of these higher caps.

The Minns state government has honoured its pre-election commitment to reverse the annual property tax opt-in for first home buyers. The First Home Buyer Choice scheme does not apply to contracts exchanged after 30 June 2023. Full transfer duty is payable on all contacts exchanged on or after 1 July 2023. Purchasers who exchanged between 16 January 2023 and 30 June 2023 have until settlement to make an election between an annual property tax and full transfer duty.

The residence requirement has been extended – eligible first home buyers must now occupy their home for a continuous period of 12 months instead of six months, within 12 months of settlement. The residence requirement applies to the First Home Buyers Assistance scheme, the First Home Owner grant, and the deferral of transfer duty payment for off the plan transactions.

The  By Lawyers New South Wales conveyancing publications have been updated accordingly. The Purchase of Real Property (NSW) and 1001 Conveyancing Answers (NSW) guides contain detailed coverage of transfer duty concessions and government grants for the purchase of real property.

Duty concessions – VIC

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The Victorian state budget contains provisions commencing on 1 July 2023 that affect transfer duty concessions and exemptions for special disability trusts and pensioners.

From 1 July 2023, pensioners purchasing real property for up to $600,000 are exempted from duty. These purchasers buying property valued between $600,001 and $750,000 pay a concessional rate of land transfer duty. The exemption and concession caps mirror the thresholds for first home buyers. Eligibility is assessed on the total value of the purchase.

From 1 July 2023, the special disability trust transfer duty deduction threshold will be increased from $500,000 to $1,500,000 for transfers of a principal place of residence. A new land transfer duty exemption will apply for the transfer of a home by an immediate family member to an individual eligible to be a beneficiary of a special disability trust. The property can be valued at up to $1,500,000. This new exemption is designed to complement the duty concessions and exemptions in s 38A of the Duties Act 2000. The exemption is intended to assist families who wish to provide a home for a severely disabled family member, but consider the process of creating and managing a special disability trust to be too expensive and complex.

The relevant By Lawyers Victorian conveyancing publications have been updated accordingly. The commentary in the Purchase of Real Property (VIC), Sale of Real Property (VIC), and 1001 Conveyancing Answers (VIC) guides contain extensive coverage of land transfer duty and land transfer duty exemptions.

TAS – transfer duty concessions

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New commentary and forms have been added to the Purchase of real property (TAS) Guide in relation to the availability of new transfer duty concessions for first home owners purchasing an established home and also pensioners downsizing to an established home.

First home transfer duty concessions – Established home

A 50% discount is available on transfer duty for first home buyers of established homes which have a dutiable value of $400,000 or less. The discount is available for purchases of established homes that settle within the period 7 February 2018 and 6 February 2019. The eligibility requirements are set out in full in our commentary. A link to the SRO form Section 46E Concession from duty -Transfer to first home buyers of an established home has been added to the matter plan.

Transfer duty concessions for pensioners downsizing

This concession provides a 50% discount on transfer duty for eligible pensioners who sell their existing home and downsize to another home (not vacant land) with a dutiable value of $400 000 or less (and also less than that of the former home). Both homes must be in Tasmania and the new home must be an established property.

The concession is available where:

  • the sale of the former home settles within the period 10 February 2018 and 9 February 2019; and
  • the purchase of the new home settles within six months before or after the transfer of the former home.

The eligibility requirements are set out in full in our commentary.

A link to the SRO form Sections 46N & 46O Concession from duty -Transfer to pensioner/s downsizing home has been added to the matter plan.

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