The Queensland Government introduced the Revenue Legislation Amendment Bill 2024 (Bill) late last year. This Bill proposes changes in relation to transfer duty relief for first homeowners and an increased renting ability for transfer duty home concession recipients.
Key Takeaway Points
- The Revenue Legislation Amendment Bill 2024 (Bill) aims at boosting housing affordability and supply.
- The Bill proposes full transfer duty relief for first homeowners for eligible new home or vacant land purchases.
- A Ministerial Directive allows transfer duty home concession recipients to rent part of their property.
Transfer duty relief for first homeowners
The Bill amends the Duties Act 2001 to provide full transfer duty relief for first homeowners purchasing a new home or vacant land to build a new home on, irrespective of the value of the home / land. This means that first home buyers will generally not have to pay any transfer duty in relation to the transfer of residential land that contains a new home or will have a home built upon it.
The proposed definition of ‘new home’ aligns with the definition used for the First Home Owner Grant. It includes:
• a home that has not been previously occupied nor that has been previously sold as a place of residence; or
• a substantially renovated home which, as renovated, has not been previously occupied nor previously sold as a place of residence.
The Bill proposes that this transfer duty relief will be available for transactions entered into on or after 1 May 2025.
What are the eligibility requirements?
For a Queenslander to be eligible to claim the transfer duty relief, they must:
• be at least 18 years of age;
• not have previously held an interest in residential land in Queensland or elsewhere (other than as trustee);
• have paid at least the unencumbered value of the home or land upon which the new home is to be constructed);
• occupy the new home for 1 year following settlement, or if the land is vacant, construct and occupy the home that is built for 1 year within 2 years of settlement; and
• not dispose of the new home prior to occupation or within 1 year of the occupation date.
Transfer duty will still apply where part of the land is used for non-residential purposes. If the purchase involves other buyers that are not first homeowners, transfer duty is still payable in relation to their interest in the land.
Consequences for failing to meet the eligibility requirements
If a person claiming the transfer duty relief does not meet the occupancy and non-disposal requirements, the person must notify the Commissioner. If this notification obligation is not complied with, the person will have committed an offence.
Upon identification or notification of non-compliance with the eligibility requirements, the Commissioner will assess the relevant circumstances and decide whether to wholly or partly remove the benefit of the relief.
Renting as a transfer duty home concession recipient
Recipients of transfer duty home concessions, regardless of whether it is the home concession, first home concession or first home vacant land concession, may lease part of their property during the initial one-year occupation period without jeopardising their concession. This change commenced via Ministerial Directive on 6 December 2024 and is therefore now operational.
This is a modification of the previous position in Queensland, in which it was not legal for a transfer duty home concession recipient to rent out their property within their first year of ownership.
Next steps
Our Property team is happy to assist if you have any queries about how the Bill may affect you / your clients.
