Australia: Zero stamp duty for over 55s who downsize and abolition of the Torrens assurance levy
Property Update

The NSW Premier Barry O'Farrell yesterday released the new State Government's 100 Day Action Plan, which confirms the Coalition's pre-election promises to axe the Torrens assurance levy and to extend the 'empty nesters' transfer duty concession.

Extension of the 'empty nesters' exemption for over 55s

Last year, the Keneally Government introduced a special two-year stamp duty exemption for over 65s to enable them to 'down size' and to encourage new home construction. It is now proposed that this exemption will be available to people over 55 for sales between 1 July 2011 and 30 June 2012.

The exemption applies to a new home purchase, or an off-the-plan purchase, if made in connection with a residence relocation by an eligible senior. If there is more than one purchaser then each of them must be an eligible senior. No other purchasers are permitted and the exemption and can only be accessed once.

The eligible seniors must sell, or have sold, their previous home and occupy the new home as their principal place of residence. The previous home must be sold either:

• within 12 months before the eligible purchase agreement; or
• within 6 months after completion of the eligible purchase agreement.

The previous home must have been affixed to land in New South Wales and the new home must be occupied as the purchaser's principal place of residence for a continuous period of at least 12 months, with that occupation starting within 12 months after completion of the eligible purchase agreement.

Torrens assurance levy to be axed

The O'Farrell Government has confirmed its pre-election promise to abolish the Torrens assurance levy. The levy is currently imposed at the rate of 0.2% on property transfers valued between $500,000 and $1 million and at 0.25% on property transfers valued above $1 million. It is proposed that the levy will be abolished from July 2011 and, depending on the final form of the legislative provisions, new buyers may benefit from deferring completion of their purchase contracts until 1 July 2011.

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