Stamp duty when buying off the plan

Discussion in 'Accounting & Tax' started by jasminekash, 24th Apr, 2017.

Join Australia's most dynamic and respected property investment community
  1. jasminekash

    jasminekash New Member

    Joined:
    24th Apr, 2017
    Posts:
    1
    Location:
    sydney
    Hi all,

    I bought a off the plan townhouse in November 2015- The stamp duty had to be paid by the end of 15months and I was under the impression that it would be time of settlement. the property is still going though its final touches and will not be ready to settle for another 2 months. If I was to pay the stamp duty 3 weeks before the settlement what kind of interest do I need to pay for the unpaid stamped of $19,562.60.

    Thanks,
    Jasmine
     
    2 people like this.
  2. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

    Joined:
    18th Jun, 2015
    Posts:
    41,667
    Location:
    Australia wide
    2 people like this.
  3. Simon Hampel

    Simon Hampel Founder Staff Member

    Joined:
    3rd Jun, 2015
    Posts:
    12,393
    Location:
    Sydney
    I believe that this is a common issue for OTP purchases, especially when completion is quite a long time away - you often incur stamp duty liabilities well before you actually get to own the asset.
     
    2 people like this.
  4. Corey Batt

    Corey Batt Well-Known Member

    Joined:
    14th Jun, 2015
    Posts:
    2,091
    Location:
    Adelaide, SA
    This will become even more of an issue with some State governments putting in new rules requiring stamp duty to now be paid at signing of contract.

    Any more reason to avoid OTP.
     
    2 people like this.
  5. Simon Hampel

    Simon Hampel Founder Staff Member

    Joined:
    3rd Jun, 2015
    Posts:
    12,393
    Location:
    Sydney
    How does that work if the contract later falls over for whatever reason (inability to secure finance etc) ?
     
    2 people like this.
  6. Corey Batt

    Corey Batt Well-Known Member

    Joined:
    14th Jun, 2015
    Posts:
    2,091
    Location:
    Adelaide, SA
    That was the first thing I said when I read it. Unsure how the government would treat it - ie repaying the duty to the ex-purchaser, retaining it or anything in between. I should think the OSR would have the info however.
     
    2 people like this.
  7. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

    Joined:
    18th Jun, 2015
    Posts:
    41,667
    Location:
    Australia wide