Stamp Duty Calculator: can you afford this tax?

A 50% stamp duty cut that started in July ’09 was set to revive the lethargic property market. The government had hoped weary investors in the stock market would choose this as a new avenue for investment. It was a cut on dwellings, costing less than $600,000. It was a short term incentive with positive results unlike the nine-year first time home-owner tax break which can be utilised until June 30th of this year.

A solid understanding of the property market and current Rudd government incentives are a keen asset when looking to buy a property today. Calculating stamp duty in the area you propose to buy can be done simply online. Online property companies offer stamp duty calculators, as well as financial institutions and to purchase a calculator can also be done online and delivered to your home, if preferred. It is clear the Rudd administration are keen to encourage spending and naturally the consumer will benefit but what is stamp duty?

Stamp duty is a tax that is paid to the government when changing documents on a property. These documents specify ownership of the property. This is an extra cost and not included in the property price and must be calculated into costs when seeking to make a purchase. There are many things to consider when buying a property and when calculating stamp duty;

• Buyer Status: Whether you’re a first-time buyer, an owner or an investor
• Property Type: New or Second-hand
• Floor Area: The size of the property
• Plans: Whether you plan for this property to be your primary residence or something else

Calculating the stamp duty tax and assessing planned spending when purchasing a property will give you the answer on what is affordable and what is unrealistic when focusing on a financial plan going forward. Utilising this easily available financial tool is a smart choice!