Stamp Duty Exceptions: What You Need to Know in NSW

Stamp Duty Relief Can Eliminate Transfer Duty Entirely on Homes Up to $800,000

A full transfer duty exemption applies to new and established homes valued up to $800,000 under the First Home Buyers Assistance Scheme for contracts entered into on or after 1 July 2023. A sliding concession applies on properties valued between $800,001 and $1,000,000. For someone purchasing in the Hills District at the median price point, this can mean the difference between paying tens of thousands in duty or nothing at all.

Consider a buyer purchasing an apartment in Castle Hill valued at $750,000. The full exemption removes what would otherwise be over $27,000 in transfer duty. That saving can be redirected toward home loan deposit requirements, settlement costs, or building an emergency buffer after purchase. The exemption applies whether you are purchasing a newly built property or an established home, provided the property will be your principal place of residence.

Buyers must move into the home within 12 months of settlement and reside in the property as their principal place of residence for at least 12 continuous months. If you fail to meet the occupancy requirement, Revenue NSW will reassess the transaction at the standard duty rate and recover the concession amount plus penalties and interest.

The Sliding Concession Between $800,001 and $1,000,000 Reduces Duty Progressively

A sliding concession applies on properties valued between $800,001 and $1,000,000. The concession reduces in proportion to the increase in property value, meaning a home valued at $850,000 receives a larger concession than one valued at $950,000. At $1,000,000 or above, no exemption or concession applies and standard transfer duty rates are charged in full.

In our experience, buyers in the Hills District often find themselves in this middle band when purchasing townhouses in Baulkham Hills or newer dual-occupancy developments in Kellyville. A property valued at $900,000 will attract duty under the sliding scale, but the concession still delivers a meaningful reduction compared to the standard rate. The calculation is managed by Revenue NSW based on the dutiable value of the property, which is the higher of the contract price and the market value as assessed by the Valuer General.

Vacant Land Has a Separate Exemption and Concession Structure

For vacant land, a full exemption applies up to $350,000 with a concession for land valued between $350,001 and $450,000. This applies where the buyer intends to build a home on the land and occupy it as their principal place of residence. Given land prices across the Hills District, particularly in growth corridors around Kellyville and Box Hill, most buyers will fall into the concession range rather than the full exemption.

The same occupancy conditions apply. You must commence building within a reasonable timeframe, move in within 12 months of completion, and occupy the home continuously for at least 12 months. Revenue NSW monitors compliance through council building approvals and occupation certificates. If you purchase vacant land but fail to build or occupy within the required timeframe, the concession will be clawed back.

You Cannot Combine NSW Stamp Duty Relief with Other State Schemes, But Federal Schemes Still Apply

NSW stamp duty relief cannot be combined with stamp duty concessions from other states or territories. You can only claim a concession in the jurisdiction where the property is located. However, state and territory grants and stamp duty concessions can generally be used alongside the Australian Government 5% Deposit Scheme and Help to Buy, though restrictions vary by jurisdiction and program.

This means a first home buyer purchasing in the Hills District can access the NSW stamp duty exemption on a property valued under $800,000 while also using the Australian Government 5% Deposit Scheme to reduce the deposit to 5% and avoid paying Lenders Mortgage Insurance. The two programs work independently and do not disqualify each other, provided all eligibility criteria for each scheme are met.

The First Home Owner Grant in NSW Is Only Available for New Builds Under $600,000

The NSW FHOG is $10,000 for new builds or substantially renovated homes only. The purchase price cap is $600,000, or a combined land and build cap of $750,000. The grant does not apply to established homes.

Given current property values in the Hills District, most buyers will find the grant difficult to access unless purchasing a new apartment in an emerging precinct or building on vacant land with a combined value under the cap. The stamp duty exemption, by contrast, applies to both new and established homes up to $800,000 and delivers a far larger benefit for most buyers in this area. We regularly see this where a buyer assumes the grant is the main benefit, only to discover the stamp duty saving is worth several times more.

Eligibility Extends Beyond First-Time Ownership to Include Those Who Have Never Owned Property in Australia

To qualify for the NSW First Home Buyers Assistance Scheme, you must not have previously owned property in Australia, either alone or jointly with someone else. This includes investment property, commercial property, or property owned in another state or territory. It also includes property owned through a trust or company structure where you held a beneficial interest.

The definition of ownership includes any legal or equitable interest in land, regardless of whether you occupied the property or derived income from it. A prior ownership interest, even if sold years earlier, will disqualify you from accessing the concession. If you are purchasing with a partner, both of you must meet the eligibility criteria independently. If one partner has owned property before, the exemption is not available to either of you on that transaction.

Revenue NSW Monitors Compliance and Will Recover Concessions If Conditions Are Not Met

Revenue NSW requires buyers to lodge a First Home Buyer declaration at the time of settlement. The declaration includes a statutory declaration confirming that you meet all eligibility criteria and agree to comply with the occupancy requirements. Revenue NSW cross-references these declarations with land title records, ATO data, and council records to monitor compliance.

If you sell the property, lease it out, or fail to occupy it within the required timeframe, Revenue NSW will issue a reassessment notice requiring you to pay the full duty amount plus interest and penalties. Interest accrues from the original settlement date. The penalty for making a false declaration can also include prosecution under the Taxation Administration Act 1996 (NSW). Keep records of your occupancy, including utility bills, council rates notices, and correspondence showing your residential address, for at least 12 months after you move in.

Applying for Stamp Duty Relief Happens at Settlement Through Your Conveyancer or Solicitor

The concession is not applied retrospectively. You must claim it at the time you lodge your transfer duty documents with Revenue NSW, which happens at settlement. Your conveyancer or solicitor will prepare the First Home Buyer declaration and lodge it electronically along with the transfer documents. Once lodged, Revenue NSW will assess the application and issue a duty assessment.

If you are using a home loan to fund the purchase, your lender will require proof that all duty and government charges have been paid before releasing settlement funds. Your conveyancer will coordinate this with your lender and ensure all amounts are paid on the settlement date. If you are uncertain whether you qualify, speak to your conveyancer before signing the contract. Once the contract is exchanged, you cannot unwind the transaction without financial penalty if you later discover you are ineligible.

Call one of our team or book an appointment at a time that works for you. We work with buyers across the Hills District and can connect you with the right loan structure to support your purchase, whether you are using the stamp duty exemption, accessing a federal deposit scheme, or combining both.

Frequently Asked Questions