What is the wake-up to yourself every morning? Put up with the crowded carriages, across the noisy streets, everyone dressed up in a hurry. For most people, the struggle is for a higher quality of life. Although the garage is not everything, but no garage is absolutely impossible. Buying a house to buy a car, paying taxes is inevitable, so it is particularly important to master the types of taxes and tax laws.
Today this article will talk about the most common tax, stamp duty.
Stamp duty is an ancient tax, no stranger to it, but little is known about its origin. According to the theory of tax historiography, any kind of tax can't do without the political and economic demand at that time, and the stamp duty is also the same.
In 1624 A.D., goverment in the Netherlands suffered a serious economic crisis. In order to solve the financial needs, Morris, the ruler of the regime at that time, proposed that the difficulties should be solved by raising taxes, but for fear of opposition from the people, he asked the ministers for advice, but he could not come up with a wonderful way to achieve the best of both sides. Finally, the public tender to seek a reward for new tax design, seek a wealth plan. Stamp duty is a masterpiece selected from a program designed by millions of candidates. It can be seen that the generation of stamp duty compared with other taxes, more legendary.
The designer of stamp duty is ingenious. He observed that people use contracts, credit vouchers and so on in their daily lives, so once the tax is taxed, the source of the tax will be very large. In addition, there is a general psychology that if a document is stamped by goverment, it can be a legal document, protected by law at the time of litigation, and therefore willing to pay stamp duty. Because of this, stamp duty is known as a "good tax" with a light tax burden, a prosperous source of tax, simple procedures and low cost.
British economist Goldberg (Kolebe) said: "The art of taxation consists in so plucking the goose as to obtain the largest possible amount of feathers withthe smallest possible amount of hissing. The art of taxation is to pull out the most goose feathers and listen to the least goose cries. " Stamp duty is a tax with the least number of geese.
Since 1624 when stamp duty appeared in the Netherlands for the first time in the world, the United States, Denmark, France, the United States, Austria and the United Kingdom have successively imposed stamp duty. In a short period of time, it has become a widely used tax in the world, and it is popular internationally.
There is of course stamp duty in Australia.
In Australia, the rules governing stamp duty vary from state to state. But overall, its tax method is the same, can be divided into two categories: price-based and volume-based taxation. In addition to the threshold for tax collection, the tax rate is not the same in different price ranges. On a quantitative basis, there is a fixed rate of taxation. This article takes Victoria as an example.
When buying and selling design assets, there will be corresponding stamp duty, such as vehicle trading, real estate transfer, stock trading.
Vehicle stamp duty
The stamp duty generated when buying and selling vehicles is not complicated. In Victoria, vehicles are divided into four categories by price and vehicle usage.
- When the price of a new car is less than $61844, the stamp duty is calculated at 3.2% of the full price;
- When the price of a new car is more than $61845, the stamp duty is calculated at 5.7% of the full price;
- For vehicles that cannot carry passengers (e.g. motorcycles), stamp duty is calculated at 2.7% of the full price;
- Used vehicles, stamp duty calculated at 4.2% of the full price
Property stamp duty
Unlike vehicle stamp duty, real estate stamp duty is relatively complex because of the variety and use of houses. In Victoria, all properties are broadly divided into two categories, Principal Place of Residence (PPR, self-housing, and Non Principal Place of Residence (investment housing, depending on whether the purchase is self-housing or not.
Victoria House Stamp tax rate
On this basis, overseas buyers will have to pay an additional 7% stamp duty.
In addition, real estate stamp duty also has a variety of exemptions.
The image above shows only the base rate of stamp duty. In practice, depending on the buyer's different conditions, may enjoy the relevant exemption clauses.
First Home Buyer Duty Exemption (if PR or Citizen)
According to the original policy, if the buyer is PR or citizen, and the property purchased is their first self-housing, the price of the house is less than 600000, then only half of the stamp duty. But if the first self-housing exceeds six hundred thousand, you don't have to worry about not getting stamp duty: for those with a price range of between six hundred thousand and seven hundred and fifty thousand, there will also be varying degrees of discount on stamp duty. In addition, the first self-housing within seven hundred and fifty thousand, can also enjoy a stamp duty reduction of A $10, 000.
If the transaction takes place between July 1, 2017 and June 30, 2020 (the trading date means that the Contract Day, is not Settlement Day), 's first self-housing for less than six hundred thousand, its stamp duty exemption is in full; For self-housing between six hundred thousand and seven hundred and fifty thousand, stamp duty is levied from six hundred thousand.
This means:
Cheer, jump!
First there must be PR, second house price is also a condition, but also the first set of self-help …
In addition, before July 1, 2017, when off-plan 's house was charged with stamp duty, since the house had not yet been built, only land prices had to be used to calculate the stamp duty. But after July 1, 2017, this advantage will disappear and stamp duty will be calculated at full price.
Pensioner Duty Exemption
The policy can only be used once. Legal pensioners (pensioner), are exempt from stamp duty if they purchase a self-housing (PPR), less than three hundred and thirty thousand. If you buy three hundred and thirty thousand to seven hundred and fifty thousand of the self-housing (PPR), then you can enjoy the corresponding deduction.
Note that, first home buyer duty exemption and pensioner duty exemption are not reusable at the same time.
Charities and Friendly Societies Duty Exemption
For charities, all stamp duty is free.
Let's give you a little example.
In order to let everyone fully understand the calculation method of real estate stamp duty, the editor will tell you about the tortuous experience that he and stamp duty have to say.
At the end of 2015, the editor and his girlfriend of three years (and now the old woman) registered for marriage in Melbourne. Whether it's for the traditional self-esteem of my Chinese men, or for better development in Melbourne in the future, let alone the pressure of a new deal (after July 1, 2016, stamp duty on home purchases abroad was raised from 3% to 7%). Buying a house became a top priority at that time. Fortunately everything went well and the contract was signed before June 30. But I was puzzled by the $31520 stamp duty on home prices of $405000, because 31,370 and 405,000 per cent were 7.746%.
According to my understanding at the time, did my stamp duty close at 7% in accordance with the new policy? Big things and small things can be tolerated, only money can not bear. Therefore, the editor immediately found the transfer lawyer, to find out exactly. Fortunately, the lawyer was patient and worked out the calculation for me:
405,000-130,000=275,000
275,000*0.06=16,500
16500 2870 / 1970 (price range and tax rate for Non principalplace of residence above)
19370 405000 / 0.03 (3% additional stamp duty for overseas persons) = 31520
Seeing this, the editor once again got confused. I bought a house for my own living. Why did I be divided into Non principal place of residence?? The lawyer also patiently explained that since the editor bought apartments, and the land ownership of the apartments was held by the opener, the calculation of stamp duty would have to be calculated on the basis of Non principal place of residence.
The editor's similar experience is likely to be met by many newcomers to Australia. Although there are many things to learn, to integrate with the local culture. But the editor thinks that now that we have come to Australia, we must abide by the local laws and regulations. Neither break the law, but also learn to use laws and regulations to protect themselves.
So here comes the question。 Since the stamp duty on this house can't be calculated according to PPR, is it still entitled to first-home buyer duty exemption? Will it still be able to enjoy the CGT exemption for self-housing when it sells the house?
If you have more questions about Stamp Duty and need professional accounting advice and services, please call 03 9620 0779 or email to [email protected] for advice.
The data section of this article is taken from the State Revenue Office website and is valid for several months since March 2017. To get the most accurate data, check the State Revenue Office website. In addition, you can browse the details of Stamp Duty directly on the website, can help you understand all aspects of Australian stamp duty related issues.
