On-selling to a FHB before titling?

Hi all,

Who would pay the stamp duty in this scenario in Vic?

Original buyer on-sells a block of land before settlement to a new purchaser who is a FHB.

B.

 

I believe you are talking about a nomination sale. If you sell the property by nomination for the exact same price on the original contract of sale, then I believe you can avoid stamp duty and the purchaser pays it. As soon as you sell for $1 more than the contract price, you both have to pay stamp duty.

 

Thanks Curious!
I was actually talking about selling at a profit before settlement (before paying out stamp duty).

Secondly, I believe a FHB would not pay duty as per the Victorian exemption -?

B.

 

To make a profit, you will need to work out what your stamp duty on the contract price is and account for it in your sales price. You may struggle to get a buyer though as they might just buy directly from the developer if there is more land available at a similar price point.

Here’s the link to the SRO site that talks about various scenarios.
Sub-sales and duty | State Revenue Office

FHB may be eligible for stamp duty exemptions or concessions but that has no relevance to you and your stamp duty obligations.

 

the buyer pays duty. If you contract and then onsell both you and the end buy pay.

 

For vacant land it could also pose a costly issue for GST depending on the circumstances. Most definitely a issue for legal advice concerning the contract/s and duty and GST issues. If GST applies its quite easily fixed if the contract is drawn up the right way.

 

Check your contract: the vendor may not allow this, or only with their prior written permission and for a fee. A Deed may also need to be signed.

Some vendors will not allow you to profit without their agent receiving a commission.