You can save substantial amounts of money with Victoria’s stamp duty concessions
The Victorian Government offers a unique concession when you purchase property off-the-plan. The concession applies to purchases of land and building packages.
It allows a deduction from the contract price of the cost of construction which occurs on or after the contract date.
Effectively, you only pay duty on the improved value of the land, the non-deductible costs and the completed construction as at the contract date. Typically, construction will not yet have started at the date of contract, or is incomplete at this date.
Maximum stamp duty savings are available for apartments purchased by prior to construction commencement. Stamp duty payable will incrementally change as construction progresses. Stamp duty is not payable until settlement.
What is a land and building package?
Put simply, a land and building package is where you enter into a contract for the purchase of land and the construction of a new house, townhouse, apartment or unit.
The concession applies to either a single lot development (for example, a suburban house and land package) or a multi-lot horizontal development such as an apartment in a residential tower.
Construction costs include
- Legal costs associated with the permit or bringing the building to completion;
- Surveyors and consultants fees;
- Planning permits;
- Water and sewerage connections;
- Buildings permits and other similar fees;
- Vic Roads approval;
- Gas and electricity approval;
- Required road access or utilities works;
- Site decontamination costs;
- Cost of demolition and removal work;
- Cost of material, labour and finance for constructing the building;
- The profit accruing to the builder/developer (in relation to the building only); and
- GST in respect of construction costs after the contract date.
The table below shows estimates of stamp duty concessions applicable based on certain variables*
*Please note you should always consult with your solicitor or accountant before entering into a property contract of sale. The above are estimates only and the rate of stamp duty may change in the future.