Key D
uty and Tax Changes for Victorian Property Purchasers: Bill Released
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For eligible first home buyers or PPR purchasers, the dutiable value of the property will
be calculated after applying the off-the-plan concession. For off-the-plan purchases
where construction has not commenced, this means that residential properties with
significantly higher contract prices may now be eligible for the PPR concession or first
home buyer duty exemption or reduction, if the land value (after deducting construction or
refurbishment costs) is below the relevant threshold.
The off-the-plan concession will no longer be available for purchases of residential
property with a dutiable value over the above thresholds. It will also no longer be
available for other purchases of property, including investment properties.
First Home Buyer Duty Exemption or Concession
The Bill amends section 57JA of the Duties Act to abolish stamp duty for purchases of
new or existing properties under a dutiable value of AUD600,000 by eligible first home
buyers. Eligible purchases of property with a dutiable value between AUD600,000 and
AUD750,000 will also receive a tapered concession applied on a sliding scale.
The exemption and concession will apply to contracts entered into on or after 1 July
2017.
Both the exemption and concession will be subject to the residence requirement that
currently applies to the PPR duty concession. At least one purchaser must occupy the
property as their PPR for at least 12 months commencing within 12 months of taking
possession of the property.
Doubling of First Home Owner Grant in Regional Victoria
The Bill amends section 18 of the First Home Owner Grant Act 2000 (Vic) to increase the
first home owner grant to AUD20,000 for new homes built in regional Victoria with a
consideration up to AUD750,000.
The increased amount will apply for contracts entered into on or after 1 July 2017 and
before 1 July 2020.
Eligible first home buyers of new homes in metropolitan Melbourne will continue to
receive the current grant of AUD10,000.
Vacant Residential Land tax in Melbourne
Under the Bill, a new section 34A will be introduced to the Land Tax Act 2005 (Vic) to
impose an annual vacant residential land tax on vacant residential properties within the
municipalities of Banyule, Bayside, Boroondara, Darebin, Glen Eira, Hobsons Bay,
Manningham, Maribyrnong, Melbourne, Monash, Moonee Valley, Moreland, Port Philip,
Stonnington, Whitehorse and Yarra.
A residential property will be vacant if it has not been used or occupied for more than six
months in the preceding calendar year by:
• the owner as their PPR
• the owner's permitted occupant as their PPR
or
• a natural person under a lease or short-term letting arrangement.