The second-biggest cheque you'll write at settlement.
Stamp duty is the most state-specific number in Australian property — the same purchase price can cost you wildly different amounts depending on which side of a border the house is on. Here's how the system actually works, where the concession thresholds bite, and where the cliffs are.
What stamp duty actually is
Stamp duty — officially called transfer duty or land transfer duty in some states — is a one-off tax you pay when you buy property. Each state and territory charges its own version, calculated on the higher of the purchase price or the market value, and payable shortly after settlement.
It's collected by state revenue offices (Revenue NSW, the State Revenue Office Victoria, the Queensland Revenue Office, and so on), and it's a significant slice of state budgets. NSW alone collects over $12 billion a year from transfer duty. The money funds infrastructure, healthcare, education — the usual mix of state-level services.
For buyers it's the second-biggest cheque at settlement after the deposit itself, and unlike most property costs it can't be financed into the loan in most cases. You need it in cash.
How the math actually works
Stamp duty is a progressive marginal bracket tax, similar in shape to income tax. You don't pay a single percentage on the whole purchase price — you pay one rate on the first chunk, a slightly higher rate on the next chunk, and so on, all the way up to the top of your purchase price.
This matters because crossing a threshold doesn't suddenly catapult your whole price into a higher rate. The rate only applies to the portion above that threshold. A property at $750,001 and one at $749,999 pay almost identical duty — the extra dollar gets charged at the bracket rate.
The exception is at concession thresholds, which work differently. If you're a first home buyer in NSW and your purchase price is $800,001, you may lose access to the full exemption and pay duty under the concessional scale. That's a real cliff. The widget below makes this concrete.
The concession landscape
Every state offers concessions of some kind. First home buyers receive the most generous treatment in every jurisdiction — typically a full exemption below one threshold and a sliding-scale concession up to another. The exact thresholds differ, sometimes dramatically.
Concessions also exist for principal-place-of-residence purchases (where you're buying to live, not to rent), for pensioners, for off-the-plan apartments, and in some states for farms passed between family members. Each has its own eligibility test, time limits, and clawback rules if you breach the conditions later.
The single most important rule: concessions are almost always conditional on you actually living in the property for a minimum period after settlement — typically 6 to 12 months. Buy it as your home, treat it as your home. Otherwise the state can claw back the duty saved.
Same purchase price, different bill
A $900,000 established home — roughly a median-ish suburban purchase in a major capital — costs meaningfully different amounts in stamp duty depending on which state it sits in. As a non-first-home buyer:
- Victoria: approximately $49,000 (the highest top-bracket rate in Australia is 6.5%)
- New South Wales: approximately $35,000
- Queensland: approximately $33,500
That's a $15,000 spread for the same notional purchase. Push to $1.5M and the spread widens further. Push to $2.5M and Victoria's top bracket bites significantly harder than the other two.
For first home buyers the picture inverts in places. Queensland's reform — no upper price cap on FHB exemption for new builds — means a first home buyer paying $1.2M for a new apartment pays $0 stamp duty in Queensland but tens of thousands in NSW or Victoria.
Things people get wrong about stamp duty
The reform debate, briefly
Stamp duty is one of the most-criticised taxes in Australia, but agreement ends there. The case against it: it's a "transaction tax" that discourages people from moving, locks older Australians in homes they no longer need, and shifts the burden onto buyers rather than the broader community of property owners. Most economists who study tax design prefer an annual land tax — paid by all owners every year — as more efficient and less distortive than a large lump-sum charge at purchase.
The case for keeping it: it's a large, reliable revenue source that funds essential state services. Switching to land tax would mean every property owner pays each year, which is politically harder than charging only new buyers. Transitional costs are also enormous — a state can't simply replace a $10 billion annual revenue stream overnight.
The ACT has been gradually phasing out stamp duty in favour of higher general rates since 2012. Other jurisdictions have flirted with reform — NSW's brief property-tax option was a partial experiment, since wound back — but none have followed the ACT's path at scale. The debate continues.
Capibrain doesn't have a position on this. The page above shows you what the current system does. What it should do is a different conversation.
The honest summary
Stamp duty is the largest single transaction tax most people will ever pay, and it's payable in cash at settlement. The system uses marginal brackets like income tax — you don't suddenly leap into a higher rate when you cross a dollar threshold, but you do cross some real concession cliffs (especially as a first home buyer).
The state-by-state variation is large. The same $900k purchase costs significantly different amounts in Victoria, NSW, and Queensland. If you're buying near a state border, or weighing investment options across states, the duty difference is real money worth modelling.
The concession landscape is genuinely complex and changes regularly. The thresholds quoted on this page were current at time of writing; for definitive figures on your specific purchase, your state revenue office is the source of truth. Your conveyancer or solicitor handles the actual payment as part of settlement.