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If you are considering entering the Northern Territory property market, don’t forget to factor the cost of stamp duty into your budget. Stamp duty can end up being one of the biggest upfront costs you pay when buying a property and could potentially add up to tens of thousands of dollars.
What is stamp duty?
According to the Northern Territory Government, stamp duty is a general purpose tax. It says you will need to pay stamp duty if you’re buying a home, land or business property in the Northern Territory.
Stamp duty is charged by each state and territory government, so the rules on how it’s calculated will vary from place to place. However, a general rule is: the more expensive your property, the more stamp duty you’ll need to pay.
Stamp duty is primarily determined by three major factors: the state or territory you’re buying the property in, the value of the property, and whether you’re eligible for any concessions or exemptions. Let’s take a look at how stamp duty is worked out in the Northern Territory.
How is stamp duty calculated in the Northern Territory
The Territory Revenue Office (TRO) calculates how much stamp duty you owe by applying the duty rate to the ‘dutiable value’ of your property. Usually your property’s dutiable value will be its market value or the amount you agreed to pay for the property, whichever one is higher.
Get an idea of how much stamp duty you’re likely to pay in the Northern Territory with our Stamp Duty Calculator. Select NT from the dropdown menu to get started.
Who has to pay stamp duty in the Northern Territory?
According to the TRO, you will need to pay stamp duty if you acquire a home, land or business property in the Northern Territory.
As well as those who buy a property, stamp duty may also be payable if ownership or interest in land is transferred to you without you actually purchasing anything, the TRO says. For example, if land is given to you as a gift.
When is stamp duty paid in the Northern Territory?
The NT Government explains that stamp duty is generally payable within 60 days of you entering into the transaction or at settlement, whichever is earlier. If you fail to pay on time, the TRO says you may be charged interest and a penalty.
Remember, your solicitor or conveyancer may be able to assist you with completing and lodging stamp duty documents, and they should be able to advise you on key deadlines specific to your transaction.
What are the stamp duty concessions in the Northern Territory?
If you’re intending to use the property as your home, you may be able to claim a concession to reduce the amount of stamp duty you have to pay, according to the NT Government. In some circumstances, concessions will apply so that no stamp duty is payable at all.
The NT Government offers three home owner concessions:
- First home owner discount
- Principal place of residence rebate
- Senior, pensioner and carer concession
The TRO advises that these are only available to people, not companies or trustees.
If you’re buying an established property as your first home, you may be eligible to receive a discount on the amount of stamp duty you need to pay. The TRO says this discount can be as much as $23,928.60, at the time of writing. The TRO also advises that the established property cannot be valued at more than $650,000.
Under the discount, there is zero stamp duty payable on homes valued up to $500,000 and a discount for properties between $500,000 and $650,000, at the time of writing.
To be eligible, the TRO outlines that you must meet the following requirements:
- At least one applicant must be 18 years old.
- At least one applicant must be an Australian citizen or permanent resident.
- You cannot receive another concession, discount, grant or rebate. This includes the First Home Owner Grant (FHOG) and Principal Place of Residence Rebate.
- The property must be your first home in Australia.
- You must be acquiring the whole property in your own right.
- At least one applicant must occupy the home as his or her principal place of residence for a continuous period of at least six months, commencing within 12 months after possession.
You won’t be eligible for the discount if you’re buying a brand new home, although the TRO advises you may be able to receive the FHOG instead.
If you’re buying a brand new home or land to build a new home, the TRO says you may be able to get a stamp duty rebate if you intend to make the property your primary address. This rebate can be up to $7,000 off your stamp duty at the time of writing.
To be eligible, you must meet the following requirements, according to the TRO:
- Cannot be entitled to the Senior, Pensioner and Carer Concession.
- Cannot have been paid or be entitled to the FHOG.
- Must be acquiring the whole of the property in your own right.
- At least one applicant must occupy the home as their principal place of residence for continuous period of at least six months. Commencement dates will vary.
If you’re a senior citizen, a pensioner or carer, you may be able to receive a reduction on the amount of stamp duty you need to pay. This reduction can be up to $10,000 off the stamp duty payable, according to TRO information at the time of writing. This concession will only apply if the dutiable value of the home isn’t more than $750,000 and land isn’t more than $385,000.
To be eligible, the TRO says you must meet the following requirements:
- Must be at least 60 years old or hold a Northern Territory Pensioner and Carer Concession (NTPCC) card.
- Must be acquiring whole of the property in your own right.
- Cannot have received or be entitled to the FHOG.
- At least one applicant who is over 60 or a NTPCC card holder must occupy the home as their principal place of residence for a continuous period of six months. Commencement dates will vary.
What are the exemptions to paying stamp duty in the Northern Territory?
In some circumstances, you will be exempt from paying any stamp duty. According to the TRO, some of the instances where you’ll be exempt from paying stamp duty could include:
- Death of property owner – for example, where the property is being transferred in accordance with the will of the deceased.
- Family farm – where a farming property is being transferred to family members or entities.
- Matrimonial home – where property is being transferred from single to joint names of spouses (including de facto) and is their principal place of residence.
Other fees and finance considerations when buying property in the Northern Territory?
Other related fees
On top of stamp duty, you’ll generally also need to pay a mortgage registration fee (if you’re buying with a home loan) and a land transfer registration fee. The mortgage registration fee is a charge for registering a home loan and the property as security on that land. The land transfer fee covers the cost of transferring the title of the property from the previous owner to you. These fees are set by the Northern Territory Government and are subject to change each financial year. From 1 July 2018, the mortgage registration fee is $145 and the transfer registration fee is also $145.
And don’t forget about solicitor/conveyancing fees, building and pest inspection fees, plus other upfront costs you might incur when buying a home.
First Home Owner Grant
If you’re a first home buyer who is buying or building a brand new home, you may be eligible to receive the Northern Territory FHOG, which can be up to $26,000 at the time of writing. From 7 May 2019, the Northern Territory Government advises that the Grant will be reduced to $10,000. Keep in mind that you cannot claim both the FHOG and stamp duty concessions.
Household Goods Grants Scheme
In addition to the FHOG, eligible first home owners buying or building a new home may be entitled to a NT Government grant of up to $2,000 for the purchase of household goods for use in that home.
Stamp duty by Australian states and territories
Find out how much stamp duty you pay in different states and territories:
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