Servicing Young & Harden districts for over 40 years
Solicitors & Attorneys
PUBLISHED JULY 2022
A new housing package has been announced under the 2022-2023 NSW Budget to assist First Home Buyers in accessing affordable housing. The new property tax option will be available for eligible First Home Buyers on properties up to $1.5 million from 16 January 2023.
Under the new scheme, first home buyers will be able to elect to pay an annual property tac in lieu of stamp duty. Properties purchased under this scheme will not be locked into the scheme if it is later sold (unless the purchaser is also an eligible first home buyer choosing to pay the property tax). All other purchasers must continue to pay stamp duty as normal.
To be eligible for the property tax:
If you are eligible, you can choose between:
The annual property tax payments will be based on the land value of the purchased property. For owner-occupied properties, this can be calculated as $400 plus 0.3% of the land value of the property. For investment properties, the property tax will be $1,500 plus 1.1% of the land value for the property. A property tax calculator will be made available after the enactment of legislation, and before the 16th January 2023, when buyers can opt-into the property tax. These tax rates will be indexed every year so that the average property tax payment rises in line with average incomes.
Existing stamp duty concessions will remain to be available for purchases up to $800,000 however the property tax option will be available for purchases up to $1.5 million.
Eligible first home buyers who sign a contract of purchase between the passage of legislation and 15 January 2023 will be eligible to opt-into the property tax, however these purchasers will be required to pay any stamp duty within the usual required periods, and from 16th January 2023 will be able to apply for and receive a refund of that duty.
The contents of this article are general in nature. For advice specific to your circumstances, please contact your legal practitioner.
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