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Stamp Duty in Western Australia

Stamp duty (or transfer duty) is a levy imposed by state and territory governments on certain dutiable transactions. In Western Australia, the Department of Finance is responsible for administering stamp duty and granting exemptions and concessions. This page deals with stamp duty in WA.

Legislation

The rules for how stamp duty is imposed are contained in the Duties Act 2008. The Department of Finance also publishes guidelines on stamp duty from time to time.

Dutiable transactions

Stamp duty is imposed on certain kinds of dutiable transactions which are listed in the Duties Act 2008.  The most common dutiable transaction is a transfer of dutiable property (for example, land).  

Other kinds of dutiable transactions include declaring trusts over dutiable property, entering into an agreement to transfer dutiable property (as distinct from transferring the property itself) and mortgage foreclosures over dutiable property. 

A dutiable transaction does not have to be made in a particular form to be dutiable.  

Dutiable property

A dutiable transaction only gives rise to a liability for stamp duty if it relates to dutiable property. The most relevant kind of dutiable property is land that is located in Western Australia. 

Other kinds of dutiable property include Western Australian business assets and certain kinds of rights such as a right to acquire dutiable property or a right to income from dutiable property (such as a right to income from rental premises). 

Some kinds of dutiable transactions will only be dutiable in relation to certain kinds of dutiable property. For example, a surrender of special dutiable property is dutiable, and special dutiable property includes certain assets such as life interests in land. 

The transfer of shares in a company may also be subject to landholder duty.

Calculation of stamp duty

Stamp duty is calculated based on the dutiable value of the dutiable property that is the subject of the transaction (for example, the purchase price of land). The dutiable value is equal to the amount paid for the dutiable property, or its market value free of other interests such as mortgages. 

Different rates of duty are applied to property depending on the bracket of its dutiable value. For example, if the dutiable value is $400,000 and an exemption or concession does not apply, the amount of stamp duty payable would be $11,305.

There are rules to ensure a person is not required to pay stamp duty twice. For example, if a person enters into a contract to buy land, entering into the contract and the subsequent sale are both types of dutiable transactions.  However, the person would only have to pay stamp duty on one of them.

How stamp duty is paid

To pay stamp duty, a person must lodge certain documents with the Department of Finance, together with a cheque for the amount of stamp duty payable.  To save time, you should get legal advice before you lodge the documents to ensure you do so correctly. 

If the dutiable transaction occurred under a written agreement, the written agreement and its counterparts should be lodged, stamped and returned to the person. 

If the dutiable transaction did not happen under a written agreement, the person will need to lodge a transfer duty statement.

A person may also be required to lodge a form to be granted an exemption or concession. These documents should generally be lodged the within two months of the dutiable transaction. The person should then pay the stamp duty within one month of receiving a duties assessment notice. If they fail to do so, they may be required to pay a penalty tax.

Exemptions and concessions

There are several exemptions from stamp duty in Western Australia, as well as concessions that reduce the amount of stamp duty payable.

First home buyers in Western Australia may be eligible for a stamp duty concession or exemption.

If a person is eligible for the first homeowners grant and purchase a property worth less than $430,000, no stamp duty is payable.

If a person is eligible for the first homeowners grant and purchases a property worth between $430,000 and $530,000, they will pay stamp duty at a concession rate.  

There is also a concessional rate of stamp duty available on some purchases of new apartments.

If you require legal advice or representation in any legal matter, please contact Go To Court Lawyers.

Author

Michelle Makela

Michelle Makela is a Legal Practice Director at Go To Court Lawyers. She holds a Juris Doctor, a Bachelor of Science (Psychology) and a Master of Criminology. She was admitted to practice in 2006. Michelle has over 15 years experience in the legal industry, working across commercial litigation, criminal law, family law and estate planning. 

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