FIRST HOME BENEFITS
If you would like to check if you are eligible for an exemption or concession in Stamp Duty click here.
FIRST HOME BUYERS ASSISTANCE SCHEME
The First Home Buyers Assistance scheme is a NSW Government initiative which provides exemptions or concessions on Stamp Duty for eligible NSW first home buyers. This includes vacant land on which you intend to build your first home.
First home buyers can apply to receive:-
- Exemptions from stamp duty on new and existing homes up to $650,000
- Concessions on Stamp Duty for new and existing homes between $650,000 and $800,000
- Eligible purchasers buying a vacant block of residential land to build their home on will pay no Stamp Duty on vacant land valued up to $350,000, and will receive concessions on duty for vacant land valued between $350,000 and $450,000.
To qualify for First Home Buyers Assistance, you must meet the criteria listed below:
- The contract and the transfer must be for the purchase of the whole of the property.
- All purchasers must be ‘eligible purchasers’. An ‘eligible purchaser’ is a natural person (i.e. not a company or trust) at least 18 years of age who has not, and whose spouse/de facto has not:
- at any time owned (either solely or with someone else) residential property in Australia other than property owned solely as trustee or executor
- previously received an exemption or concession under First Home—New Home.
- At least 1 eligible purchaser must occupy the home as their principal place of residence for a continuous period of 6 months, commencing within 12 months of completion of the agreement. (Where an eligible purchaser was a member of the permanent forces of the Australian Defence Force and all purchasers were enrolled on the NSW electoral roll, as at the transaction date, then all purchasers are exempt from the residence requirement).
First Home Owners Grant (New Homes)
First home buyers building a new property may be entitled to a $10,000 grant on homes worth up to $750,000.
First home buyers purchasing a brand new property worth up to $600,000 may be entitled to a $10,000 grant.
The criteria to be eligible for the First Home Owner Grant are:-
- at least one buyer must be an Australian citizen or permanent resident
- the agreement must be for the purchase of the whole property
- you must be a natural person (not a company or trust)
- you must be over 18
- the home is a brand new home
- you or your partner have not previously owned property in any form in Australia
- at least one purchaser must occupy the home within 12 months and needs to live in the home for a continuous period of at least 6 months
- you have not previously received a First Home Owners Grant in any State or Territory.
First Home Super Saver Scheme
From 1 July 2017, those eligible to participate in the first home super saver (FHSS) scheme have been able to make voluntary concessional (before-tax) and non-concessional (after-tax) contributions into their super fund to save for their first home.
Existing superannuation contribution caps still apply to those participating in the scheme.
For example, the annual financial year cap on concessional contributions remains at $25,000.
To qualify for the scheme, people must:
- Not have previously owned property in Australia, including an investment property.
- Not have previously released FHSS scheme funds.
- Either live or intend to live in the premises they are buying as soon as practicable.
- Intended to live in the property for at least six months of the first 12 months they own it, after it is practical to move in.
In certain circumstances the commissioner of the taxation may determine that someone has suffered a financial hardship (as specified by regulations) and make an exception to the qualification criteria.
From July 1 2018, participants in the scheme can apply to have their FHSS scheme contributions, along with associated investments earnings, released to assist with purchasing their first home.
Participants, who must be 18 years or older, can apply for the release of voluntary contributions up to maximum on $15,000 from any one financial year and $30,000 in total across all years. The released funds will be taxed at the individual’s marginal tax rates less a 30 per cent offset.
If a couple buy a house together, both can take advantage of the scheme, thereby potentially amassing up to $60,000 between them to put towards the purchase of their first home.
Once the funds are released, participates have up to 12 months to sign Contract to purchase or
build a home.
The federal government believes that “most first home buyers will be able to accelerate their savings by at least 30 per cent using the scheme”.
First Home Super
Saver Scheme https://www.ato.gov.au/individuals/super/super-housing-measures/first-home-super-saver-scheme/
If you would like to know more about these benefits, please contact the Office of State Revenue or our office.
You can read more about first home benefits at https://www.revenue.nsw.gov.au/first-home-buyers
The Government’s HomeBuilder will provide eligible owner-occupiers (not just first home buyers) with a grant of $25,000 to build a new home or substantially renovate an existing home.
- HomeBuilder is a time-limited and demand-driven grant program to help the residential construction market to get through the COVID-19 pandemic.
- HomeBuilder will provide eligible owner-occupiers (not just first home buyers) with a grant of $25,000 to build a new home or substantially renovate an existing home where the contract is entered into between 4 June 2020 and 31 December 2020.
- Construction of a new home or substantial renovation must be contracted to commence within three months of the contract date.
- Consistent with the Morrison Government’s principles, the Scheme will be implemented through existing systems being the States’ respective Revenue Offices.
- HomeBuilder will complement existing State and Territory First Home Owner Grant programs, stamp duty concessions and other grant schemes, as well as the Commonwealth’s First Home Loan Deposit Scheme and First Home Super Saver Scheme.
To access HomeBuilder, owner-occupiers must meet the following eligibility criteria:
- you are an individual, not a company or trust;
- you are aged 18 years or older;
- you are an Australian citizen;
- you meet one of the following two income caps:
~ $125,000 per annum for an individual applicant based on 2018/19 tax return or later; or
~ $200,000 per annum for a couple based on your combined on 2018/19 tax return or later;
- you enter into a building contract between 4 June 2020 to 31 December 2020 to either:
~ build a new home as a principal place of residence valued up to $750,000 (including land); or ~ substantially renovate your existing home as a principal place of residence, with renovations valued at between $150,000 and $750,000 with the dwelling not valued at more than $1.5 million before the renovation;
- The respective revenue offices of each of the States will implement the Scheme and will use existing mechanism to mitigate the chances of fraud occurring.
- Owner-builders and those seeking to build a new home or renovate an existing home as an investment property are ineligible for HomeBuilder.
- Funding will go directly to individuals, not the contractors, and the individuals are committing a significant amount of investment themselves that this grant will complement.
- The forecast for the market means contractors will be operating in an environment with strong competition for work, ultimately helping drive lower prices.
- Renovations or building work must be undertaken by a registered or licenced building service 'contractor'
(depending on the state or territory you live in) and named as a builder on the building licence or permit. They must have held the building licence or endorsed contractor licence before the date of announcement.
- The registered or licensed builder (depending on the state or territory) must demonstrate that the contract price for the new build or substantial renovation be no more than a comparable product (measured by quality, location and size) as at 1 July 2019, if requested by the purchaser.
- In negotiating a building contact, the parties must deal with each other at arm’s length;
~ This means the contract must be made by two parties freely and independently of each other, and without some special relationship, such as being a relative.
~ The terms of the contract should be commercially reasonable and the contract price should not be inflated compared to the fair market price.
WHAT CAN BE RENOVATED USING HOMEBUILDER?
- The renovation works must be to improve the accessibility, safety and liveability of the dwelling.
- The renovation can be a combination of works (ie kitchen and bathroom renovation) but must be under the supervision of a registered or licenced builder.
WHAT CANNOT BE RENOVATED USING HOMEBUILDER?
- Homebuilder cannot be for used for additions to the property that are unconnected to the principle place of residence such as swimming pools, tennis courts, outdoor spas and saunas, and detached sheds or garages.
TIMING AND HOW TO APPLY
- More information on HomeBuilder, including eligibility, can be found on the Treasury Coronavirus Economic Response website.
- People will be able to apply for HomeBuilder when the relevant State or Territory Government that they live in, or plan to live in, signs the National Partnership Agreement.
- States and Territories will backdate acceptance of HomeBuilder applications to 4 June 2020. Applications will only be accepted up to and including 31 December 2020.
- Information on when and how you will be able to apply through the relevant State or Territory will become available in due course.
WHAT IF A CONTRACT HAS ALREADY BEEN SIGNED?
The Federal Government has advised that this would not be considered new work, even if the contract is terminated and a new contract entered into for the balance of the work. As the grants will be administered by the State and Territory Governments, the detail is still to be worked out, but this will be part of the criteria.
*Courtesy of Master Builders Association