stamp duty exemption

[brains]

Hi All,

I have a question and im not sure if this is the correct section, but here goes.

I own a few PIs in QLD and my PPOR is in NSW. The bank (ING)has mortgages on the PIs as well as the PPOR as security.

Im looking to refinace my loan and apparently i can get an exemption from mortgage Stamp Duty on the new mortgage. (Westpac)

My question is: Would the stamp duty have been paid in NSW (PPOR) or QLD (IPs).

And what ever state it was paid in will it change when i refinance if the new bank is in a different state, or doesnt that matter.

Im a bit confused about all this so i hope someone understands what im getting at.

Thanks

 

[asy]

Hey Brains!!

I have moved the thread to finance, so that Rolf sees it!!

It is really about mortgage stamp duty, not sale stamp duty...

Please let me know if I have read it incorrectly

asy

 

[brains]

stamp duty exemprtion

Thanke and yes you have

 

[NigelW]

Originally posted by brains
Hi All,

I have a question and im not sure if this is the correct section, but here goes.

I own a few PIs in QLD and my PPOR is in NSW. The bank (ING)has mortgages on the PIs as well as the PPOR as security.

Im looking to refinace my loan and apparently i can get an exemption from mortgage Stamp Duty on the new mortgage. (Westpac)

My question is: Would the stamp duty have been paid in NSW (PPOR) or QLD (IPs).

And what ever state it was paid in will it change when i refinance if the new bank is in a different state, or doesnt that matter.

Im a bit confused about all this so i hope someone understands what im getting at.

Thanks

Stamp duty is a tricky and esoteric topic...but Asy has picked up one of the distinctions you need to make.

Firstly - stamp duty is a state based tax. Generally speaking so far as property is concerned the state where the property is located is the key issue. Where you are, or where your bank is, will generally be irrelevant. (I'm really generalising here - all sorts of other "nexus" issues can be relevant)

Thieving buggers that the govt is, there are 2 types of stamp duty relevant to IPs (actually there are more but let's not confuse the issue for present purposes)

1) transfer or conveyance duty - this is the duty you have to pay on the contract of sale when you buy a property.

2) mortgage duty - this is the stamp duty payable based on the value of the loan secured by the mortgage which your bank will take as security over your property/ies.

So in answer to your questions:

a) When you bought each property you would have paid both transfer duty and mortgage duty in the state where each property is located.

b) now when you refinance, transfer duty is not relevant (because you still own the properties) it is just the mortgagee which is changing). There will be mortgage duty on the new mortgages which your bank takes. BUT various states decided it was a good idea to encourage mobility in the mortgage market so they introduced both transfer of mortgage concessional duty (ie where one bank takes over the existing mortgage) and special refinance exemptions from mortgage duty. I make no comment about whether they may be applicable in your case. SO in summary no the state you pay duty in won't change [unless they realign the state borders ]

Hope this general overview clarifies things a bit. Naturally you should get your own detailed advice, specific to your circumstances.

Cheers
NigelW

 

[Rolf Latham]

Hi Brains

Say the value of the mortgage is 200 000 and all you do is move to another lender, then new duty should not be required.

However, be prepared for a bit of a mortgage stamp duty upgrade if you are rejigging previously cross collaterlised loans where another property provides security, especially if they are in different states.

ta

rolf

 

[paulzag]

Another reason to never cross collateralize mortgages:

I got slugged with mortgage stamp duty in QLD and NSW coz my bank x-colled a loan. This was on the aggregate amount of the loan. When I changed the setup they tried to slugg me again and it took two letters and lots of phone-calls to get the duty refunded.

 

[Whozat]

Mortgage Stamp Duty in Queensland

I am in the process of refinancing an IP located in Queensland. State Revenue tells me that mortgage stamp duty is payable if the property is not my principal place of residence, so unfortunately it looks like I am going to have to pay it.