State Revenue Office Vic announcements

March 24, 2017

The State Government of Victoria has recently announced proposed changes to the First Home Owner Grant, the rates of stamp duty (land transfer duty) payable under certain circumstances and has introduced a Vacant Residential Property Tax.

FIRST HOME OWNER GRANT

For those people residing in regional Victoria, the First Home Owner Grant will be increased from $10,000 to $20,000 for new homes built valued up to $750,000.

This will apply for new contracts signed from 1 July, 2017 to 30 June, 2020.

FIRST HOME OWNER STAMP DUTY RATES

Those people residing anywhere in Victoria, and building or purchasing their first home valued up to $600,000, will be fully exempt from stamp duty. If the home is valued between $600,000 and $750,000 a sliding scale concession will be applied.

Generally, to qualify for the above exemption or concession, the following conditions apply:

The Purchasers (including partner) must be first home buyers consistent with the definition under the First Home Owner Grant Act 2000.
The Purchasers must be an Australian citizens or permanent citizens.
The property purchased must be used as the purchaser’s principal place of residence for a continuous period of 12 months, commencing within 12 months of possession of the purchased property.
Appropriate documentation will need to be completed when finalising the purchase.

The above exemption and concession will apply for all contracts signed from 1 July, 2017 and is in addition to the First Home Owner Grant.

OFF THE PLAN STAMP DUTY CONCESSION

Only property purchasers who plan to live in their property will be eligible for an Off the Plan stamp duty concession. These include purchasers who are eligible for:

A first home buyer stamp duty exemption or concession (dutiable value up to $750,000); or
A principal place of residence stamp duty exemption or concession (dutiable value up to $550,000).

This concession will apply to all contracts signed from 1 July, 2017.

VACANT RESIDENTIAL PROPERTY TAX

This tax is a new initiative and is intended to encourage owners of vacant property to make their property available for purchase or rent, allowing housing stock to be used efficiently.

The tax will apply to the local council areas of Banyule, Bayside, Boroondara, Darebin, Glen Eira, Hobson’s Bay, Manningham, Maribyrnong, Melbourne, Monash, Moonee Valley, Moreland, Port Phillip, Stonnington, Whitehorse and Yarra.

The tax will only apply to the owner of a property that remains unoccupied for more than 6 months within a calendar year.

The rate of tax will be 1% on the capital improved value of the taxable property and owners will be expected to self-report when their property triggers the tax.

It is recognised that there will be legitimate reasons for a property to remain vacant and the list of exemptions will be finalised in consultation with industry and property groups.

This tax will apply from 1 January, 2018 and transition arrangements for 2017 will be subject to consultation.

The above information has been extracted from the Fact Sheets provided by the State Revenue Office of Victoria.

If you require further details or need assistance, you can contact Lawcorp Lawyers on 9894 6888 or go to the State Revenue Office Vic website.

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