What Is the Off-the-Plan Concession?

Since 2012 South Australia’s capital city, Adelaide, has actively sought to encourage investment in newly developed apartment buildings (does not include townhouses) by reducing the stamp duty cost on those purchases.

Off-the-Plan means that your purchase is made before the apartment building has been physically completed. Since June 2016, the Off-the-Plan Concession was extended to apartments purchased throughout South Australia, beyond the previous central boundary.

What are the benefits of the Off-the-Plan concession?

Whether you’re a First Home Owner or looking to purchase an investment property, this concession provides a significant reduction in the amount of stamp duty you will pay on your purchase. It can be used in conjunction with the First Home Owner Grant, making is especially attractive if you are considering an apartment for your first home.

When you’re looking to purchase a new home or investment, anything to reduce your upfront costs and long-term repayments is a positive thing.

How much is the Off-the-Plan Concession?

The Concession is adjusted depending upon the market value of the apartment and the stage of completion of the residential development.
For apartments valued at $500 000 or below, it is calculated by the formula:

DV = (MV x 0.35) + (MV x 0.65 x C)

DV = The Dutiable Value
MV = The Market Value
    C = An % that represents the stages of how close to completion the apartment
         development is - Stage 1 = 0%, 2 = 20%, 3 = 40%, 4 = 60%, 5 = 80%, 6 = 100%

For a full breakdown of how the Concession for apartments under $500k is calculated, click here.

For apartments valued above $500 000, the concession is scaled depending upon the stage of completion of the residential development.

You can utilise this calculator to determine the stamp duty payable and concession that could be applicable to your apartment purchase.

Am I eligible to receive the Concession?

• a new building that is yet to be constructed;
• is a new building for which construction has commenced and where the Commissioner is satisfied that the work has not been substantially completed; or
• is an existing building where the Commissioner is satisfied that the building is to be substantially refurbished and that refurbishment:
• is yet to be commenced; or
• has commenced but the Commissioner is satisfied that the work has not been substantially completed.

If an apartment is being purchased jointly by two or more people, under the law any benefit arising under the Concession should be shared jointly.

How do I apply?

If you have recently purchased an apartment that is eligible to receive the concession, or you are looking to purchase an apartment prior to June 30, 2017, you will be required to complete an Application for Stamp Duty Concession on the Purchase of an Off-the-Plan Apartment will need to be submitted to RevenueSA for processing. If your purchase was made on or prior to that date, you can still apply as well. Contact Revenue SA for more information.

KingsCoin can help guide you through this process and put you on the right track. Please don't hesitate to contact KingsCoin and discover more about how we can assist you to create wealth from your next property purchase.