Buying a property | State Revenue Office

Apart from the taxes you pay when buying a property, there are a range of benefits that may be available.

Before you buy a property, here is some information you need to know

1. You pay land transfer (stamp) duty on your purchase

When you buy or acquire a property, you will most likely have to pay land transfer duty (commonly called stamp duty). The amount of duty you pay depends on the value of your property and whether you are eligible for any exemptions or concessions or if you are a foreign purchaser.

2. There are exemptions and concessions

You may be eligible for exemptions and concessions from land transfer duty on your property, especially if you are buying a home.

Some concessions or exemptions are temporary:

You may be eligible for a land transfer (stamp) duty waiver for residential property with a dutiable value of $1 million or less, whether or not you use it as your principal place of residence. You must sign your contract on or after 25 November 2020 and before 1 July 2021.
If you buy a new residential property within the City of Melbourne local government area with a dutiable value of $1 million or less, you may be entitled to a land transfer (stamp) duty exemption or concession (where you pay only 50% of the duty otherwise payable). Different contract dates apply to the exemption and the concession.
Temporary off-the-plan concession for purchases of dwellings in a strata subdivision will be available for contracts entered into from 21 October 2024, for 12 months.

Read more information about the various land transfer duty exemptions and concessions.

3. Buying your first home

In addition to a land transfer duty exemption/concession, you may be eligible for a First Home Owner Grant. The grant is a payment made to you, whereas the duty exemption/concessions are a reduction in the amount of land transfer duty you pay.

You can also refer to our comparison table to understand the differences between the First Home Owner Grant and the most common land transfer duty concessions and benefits, including the principal place of residence duty concession.

4. Outstanding land tax

Historically, outstanding land tax was paid before there is an ownership change. This was usually addressed as part of adjustments to a sale, with the vendor and purchaser agreeing who would pay the outstanding land tax.

From 1 January 2024, vendors are prohibited from passing on land tax to purchasers in certain circumstances.

The prohibition applies to contracts entered into on or after 1 January 2024, where the sale price is less than $10 million. ‘Sale price’ is the price of land that is specified in the contract of sale of land, however expressed, inclusive of GST.

The $10 million threshold applies in 2024 and will be indexed annually. The new threshold for the following year will be published by 1 December each year on Consumer Affairs Victoria's website.

For more details on the prohibition, see commonly asked questions and answers.

5. We need to know you are the owner

It's important that we know that you are the new owner so that we can update our land ownership records. We may also need to know if your property is in a congestion levy area or is on Melbourne's fringe. You should also be aware that as an ongoing owner, you may have to pay other taxes and levies. For example, from 1 January 2016, an absentee owner surcharge on land tax applies to Victorian land owned by an absentee owner.

If I buy residential property, what taxes, duties and benefits are involved?

Calculating and paying duty

The rate of duty, starting at 1.4% and rising to 6.5%, depends on the value of your property and when the agreement or arrangement for the transfer was entered into. If you are a foreign purchaser there is additional duty of 8%.

We charge duty based on dutiable value. This is the higher of:

the price you paid for the property, or
the price for which it may be reasonably sold on the open market.

Calculate your duty

While, under the Taxation Administration Act 1997 payment of duty is required within 30 days of settlement, the transition to electronic conveyancing means that duty is now usually paid at settlement. This ensures that, as part of the electronic conveyancing process, the property’s title can be registered with the Titles Office instantaneously.

When you buy your property, your conveyancer/solicitor or bank will normally organise and pay duty on your behalf. To confirm that duty has been paid, ask them for a duty statement.

If duty isn’t paid within 30 days of settlement, penalty tax and interest may apply.

Conveyancing industry

Regular lodgers involved in the property conveyancing industry should apply to become a Duties Online registered user.

Individuals

Members of the public who are not using a Duties Online registered user (usually a solicitor or conveyancer) and wish to lodge electronically as an individual can do so after a simple registration process. You can electronically lodge scanned documents for a land transfer of declaration of trust via our website after you register with us.

Digital Duties Form

Our Digital Duties Form is mandatory for all property transfers. Taxpayers and their representatives must use the digital form for all contracts or agreements for land transfer duty.

A number of resources are available to help you understand the process.

Frequently asked questions

Reference guide

Webinars

Complete the Digital Duties Form

Guide to Transacting with Duties Online

Property clearance certificates

Unpaid land tax is a first charge on the title to the land to which it relates.

If you are buying a property, you can apply for a property clearance certificate (previously known as a land tax clearance certificate) to see whether any land tax is owed and, if so, how much. You can then resolve the issue of any land tax owing on the property with the vendor as part of settlement.

As a result of recent legislation, vendors are generally prohibited from passing on land tax to a purchaser under a contract of sale of land entered into on or after 1 January 2024. This prohibition does not apply to contracts where the sale price for the property is $10 million or more, with this threshold updated annually based on the consumer price index. More details on the threshold are available on Consumer Affairs Victoria's website.

You can apply online and pay the application fee securely by credit card.

All certificates are subject to notes which you should read carefully.

Conveyancing industry

If you frequently apply for property clearance certificates, you should become a registered LTX Express Clearance Certificates user.

The benefits of becoming a registered user are that you can create, save and manage multiple certificate applications and update requests with secure encrypted payment available by Visa, MasterCard or monthly direct debit.

Exemptions, concessions and the First Home Owner Grant

You may be eligible for the First Home Owner Grant (FHOG) and one or more duty exemptions and concessions when you buy property in Victoria. These include, but are not limited to:

FHOG – a one-off grant of $10,000 for new first homes ($20,000 for new homes in regional Victoria if the contract was entered into before 1 July 2021) valued up to $750,000.
First-home buyer duty exemption or concession – a one-off duty exemption for a principal place of residence (PPR) valued up to $600,000, or a concession for a PPR with a dutiable value from $600,001 to $750,000 if you enter into your contract on or after 1 July 2017.
First-home buyer reduction – a one-off duty reduction of up to 50% for a PPR valued up to $600,000 if you entered into your contract before 1 July 2017.
Off-the-plan concession – a duty concession for an off-the-plan property, either as a land and building package, or as a refurbished lot.
Pensioner concession – a one-off duty exemption or concession for a new or established home valued up to $750,000.
Special disability trusts or transfer to someone with a disability – exemptions are available in certain circumstances, where a home is provided for a person with a disability.
Principal place of residence (PPR) concession – a duty concession for when a property you buy, valued up to $550,000, is to be used as your primary home.
Young farmer’s exemption/concession – a one-off duty exemption or concession for young farmers buying their first farmland property.

You may be eligible for more than one of these exemptions or concessions. You should discuss these with your conveyancer and/or representative before settlement.

Importantly, you should complete all relevant forms before settlement and advise your conveyancer, solicitor and bank so that the right exemption or concession can be claimed on your behalf, and you pay the correct amount of duty on settlement. Otherwise you may pay more than you need to, and have to apply for a refund.

Most exemptions and concessions can be processed through Duties Online, which means you won't have to apply for a refund.

The timing of any exemption and concession depends on the contract you sign to buy/build your new home. The timing of your FHOG depends on whether you lodge your application directly with us or via an approved agent.

What is your principal place of residence (PPR)?

If you own, either by yourself or with someone else, the home you live in, this is called your principal place of residence (PPR).

To satisfy some eligibility requirements for concessions and/or benefits available to homebuyers, you must live in your property as your PPR for at least a year. Generally, you must start living in the property within 12 months of settlement or completion of construction.

We can extend the start of your 12-month period, but you must request this in writing.

If you are unable to move into an intended new home due to family or domestic violence

If you have experienced or are experiencing family or domestic violence, and this has led to you being unable to meet the residence requirement for land transfer duty and FHOG, you may be eligible for ex gratia relief if the following conditions are met:

the land must be owned solely or jointly by you, and
you have not or will not receive a financial benefit from the property, including rental income.

If you moved into the property for any period of time, the Commissioner may be able to reduce the residence requirement if you request a variation of residence.

Documents required to support your application could include:

details of any financial settlement with your previous partner for the breakdown of the relationship
a declaration, such as an affidavit or statutory declaration confirming relevant details including what has happened with the property and/or what you intend to do with the property
any other supporting information such as medical documents, court documents, police statements/reports

If you would like to discuss your specific circumstances and whether ex gratia relief or a time variation could be considered, please submit an online enquiry (select the ‘Family and domestic violence’ category) or contact us by phone. If you or someone you know needs help, there are a wide range of family violence support services available.

Additional FHOG and first home buyer concession eligibility

If you have previously applied and qualified for FHOG or the first home buyer concession, but you later left the residence due to family or domestic violence, you may be eligible to access an additional FHOG and/or an additional first home buyer concession/exemption as an ex gratia payment if you:

will be the sole or joint owner of the new property
intend to live in the new property as your PPR for at least 12 months, starting within 12 months of the date of settlement or completion of construction;
have not received a financial benefit from the previous property; and
any current partner meets the eligibility requirements.

Documents required to support your application could include:

details of your previous address, purchase price and ownership details, including whether you have been known by any other name
details of any financial settlement with your previous partner for the breakdown of the relationship
a declaration, such as an affidavit or statutory declaration confirming relevant details
any other supporting information such as medical documents, court documents, police statements/reports.

Let us know you are a new owner

It's easy to let us that you are the new owner of land. You must complete and lodge a notice of acquisition with the Land Registry. Your conveyancer/solicitor usually does this on your behalf when they register your title to the property, but we recommend you check that it has been done correctly.

The notice of acquisition must be lodged within one month of your settlement and once this occurs, the Land Registry will tell us you are the new owner.

Note: It is very important that you confirm in your acquisition notice if your new property will be your PPR.

Your new property is your PPR

If you intend to live in your new property as your PPR, state this in the notice of acquisition. This is because your home is exempt from land tax.

Your new property is not your PPR

If your property is not your PPR and no other exemption applies, you will probably have to pay annual land tax.

If you hold the land as a trustee for a trust, you must notify us of this trust acquisition of an interest in land within one month of settlement. Land held on trust may be subject to higher rates of tax but in certain circumstances, a concession and/or exemption may apply.

More about land tax

Please note, there are obligations you must meet as an ongoing owner of a property in Victoria.

First homes

If you are buying a new first home, buying an existing property that is for sale as a residential premises for the first time, or building a first home, you may be eligible for one or more of the following:

A one-off grant (FHOG) of $10,000 for new first homes ($20,000 in regional Victoria if the contract was entered into before 1 July 2021) for homes valued at $750,000 or less.
A first home buyer duty exemption for new homes valued up to $600,000 or a first home buyer concession for homes value from $600,001 to $750,000 if you enter into your contract on or after 1 July 2017.
A first-home buyer duty reduction of up to 50% for homes valued at $600,000 or less if you entered into your contract before 1 July 2017.
A PPR concession for homes valued at $550,000 or less.
An off-the-plan concession.

A new home can be a house, townhouse, apartment, unit or similar, but must be a property that is being sold for the first time as a residential premises.

Established homes

Established homes are no longer eligible to receive the FHOG. However, if you are buying an established home as your first home and you otherwise meet the FHOG eligibility criteria, you may be entitled to:

a first home buyer duty exemption for homes valued up to $600,000 or a first home buyer concession for homes valued from $600,001 to $750,000 if you enter into your contract on or after 1 July 2017,
first home buyer duty concession of up to 50% for homes valued at $600,000 or less if you entered into your contract before 1 July 2017, and/or
PPR concession for homes valued at $550,000 or less.

Buying a home as a pensioner

A one-off pensioner and concession cardholder duty exemption or concession is offered to all eligible pensioner and concession cardholders, including those who are first home buyers, for homes valued up to $750,000.

You may qualify for the first home buyer duty exemption, concession or reduction and a one-off pensioner and concession cardholder duty reduction when buying your home.

You cannot, however, receive both so you must elect to receive one or the other when you submit your application form.

If you signed your contract before 1 July 2023, you can calculate your duty to work out which is worth more for you.

Off-the-plan properties

An off-the-plan concession is available to eligible buyers of a land and building package, or a refurbished lot.

Contracts signed before 1 July 2017: The concession is available for all property types, including homes purchased for investment purposes and commercial properties.

Contracts signed on or after 1 July 2017: The concession is only available for the purchase of a home. The transfer must also qualify for the PPR concession or the first-home buyer duty exemption/concession, which impose a 12-month residence requirement and other thresholds. Failing to meet the residence requirement will result in the transfer being reassessed and the concession removed.

For contracts entered into on or after 1 July 2021 and on or before 30 June 2023, the PPR concession or the first home buyer duty exemption or concession thresholds do not apply. If the value of your home is $1,000,000 or below after applying the off-the-plan concession, you will be charged duty on the lower value provided you meet all the eligibility requirements, other than the $550,000 threshold, for the PPR concession.

The concession deducts, from the contract price, the cost of construction or refurbishment occurring on or after the contract date. This means you pay duty only on the:

improved value of the land
non-deductible costs, and
completed construction/refurbishment (including GST).

The vendor generally applies for the off-the-plan concession via our application form, where you will find instructions to help you calculate an estimated concession amount.

Temporary off-the-plan concession

On 21 October 2024, the Victoria Government announced a new temporary off-the-plan land transfer duty concession for purchases of dwellings (including apartments and townhouses) in a strata subdivision. where the contract is entered into from 21 October 2024, for 12 months.

To learn more about the eligibility requirements, visit our temporary off-the-plan duty concession webpage.

Young farmers buying a farm

Eligible farmers aged under 35 may receive assistance when buying their first farmland. The extent of assistance depends on the date the farmland is transferred.

Transfers made before 1 July 2018:

A full exemption from duty is available on farmland valued at no more than $300,000.
A partial exemption from duty is available on farmland valued at no more than $600,000. This is calculated by subtracting the duty payable on $300,000 from the duty payable on the value of the farmland (of $600,0000 or less).
A concession from duty is available for farmland valued between $600,000 and $750,000.

Transfers made on or after 1 July 2018:

A full exemption from duty is available on farmland valued at no more than $600,000.
A concession from duty is available for farmland valued from $600,001 and $750,000.

You must choose between this exemption or concession or the PPR concession, whichever you calculate is worth more to you.

Complete our application form if you wish to claim the young farmers duty/concession for buying a farm. You may be eligible even if you have previously owned non-farmland.

Apply as a young farmer

Investment properties and holiday homes

Buying a property that you do not use as your principal place of residence, for example a holiday home or investment property, will attract duty.

The off-the-plan concession is not available for properties you do not use as your principal place of residence if the contract is signed on or after 1 July 2017.

As with buying a home to live in, once you own the property (investment or holiday home), you may have to pay other taxes or levies.

Melbourne properties with car parks

You do not need to do anything if you buy a residential property with parking space/s in the congestion levy area, and:

Only you will use the parking space/s to park your car while you live in the property.
The parking space/s is only for a resident to park their car.

You have to register with us if a parking space on a residential property is used for a non-residential purpose and is not exempt from the levy, for example, it is leased to another person.

You also need to register with us within one month of settlement if you buy a property in the congestion levy area that is:

a public or private car park, or
non-residential property on which leviable parking spaces are located.

More about the congestion levy

Land on Melbourne's fringe

You do not need to do anything if you have bought a property in a Growth Areas Infrastructure Contribution (GAIC) contribution area that:

has a total title area of 0.41 hectares (4100 square metres) or less, and
does not have a GAIC recording against its title.

If there is a GAIC recording against the property's title, you will be liable to pay the GAIC unless an excluded event or exemption applies.

More about GAIC

Your obligations and responsibilities

You must always provide us with true and accurate information. If we find you provided false or misleading statements on any application or do not meet the residency requirements, you will have to repay the grant and/or any duty amounts. You may also face penalties.

We regularly share resources with other agencies to ensure all eligibility requirements for the First Home Owner Grant and/or other concessions, exemptions and reductions are met. These information checks may occur months or even years after you obtained the grant. All information you provide is managed in line with our privacy policy.

Overpaid duty

If you believe that you overpaid duty when you bought your home because, for example, you were eligible for a benefit but did not claim it, you may apply for a duty reassessment. If we find that you are eligible, we will refund the overpaid duty.

To apply for a reassessment, you should send us a cover letter along with the completed application forms for the relevant exemption, concession or reduction/s and any supporting documents.

Apply for a reassessment

Your request must be made within five years of paying the duty.

Please note the amount of your refund depends on a number of factors, including the settlement date and the value of your property at that time. We receive large volumes of refund applications so your case may take up to 60 days to process.