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Simply put, stamp duty is a tax imposed on acquisitions (things that are acquired), for example, homes, cars, physical chattel etc. Historically these stamps were placed on cheques, contracts, licenses and important documentation of the likes to show they were processed. Hence, stamp duty started out almost as a processing fee.
Today they are imposed purely for tax purposes, where the buyer of property will need to pay the duty within 30 days of settlement. So while you can avoid some fees here and there, this duty is one thing that generally remains unavoidable.
The stamp duty is usually calculated based on two elements, those being the market value of the property you’re purchasing or the property purchase price. However, the amount payable is based on regulations stipulated by the state you’re located in,
Conversely, some individuals are exempt from paying the duty, such as pensioners or those involved in “off-the-plan” sales. Consulting a property lawyer would be best to ensure you’re fully aware of your obligations or if you fall under the specified exemptions and concessions.
It is important to keep in mind that the levies charged by each state for stamp duty is often subject to change, so make sure that you stay updated on the stamp duty applicable to your state via the official government websites.
The information contained in this article is provided as general advice only. We encourage you to seek independent legal advice prior to entering into any such arrangement.