Stamp duty when flipping a house in Australia

Stamp duty when flipping a house is the one cost you cannot renovate away, negotiate down, or earn back. The moment you sign the contract it is locked in, it buys you nothing you can resell, and on most deals it is the single largest line item after the purchase price itself. Yet it is the number I see people guess at more than any other, usually as a lazy round percentage, and the guess is almost always wrong.

Get it wrong and you have quietly overpaid before touching a single wall. So here is how stamp duty actually works on a flip: how the bill is calculated, why the concessions everyone quotes do not apply to you, what a real number looks like, and how to build it into a deal before you offer instead of after you are committed. This is general information, not tax or legal advice, and duty rules change and differ by state, so always confirm your own figure before you exchange.

Why stamp duty when flipping a house hurts more than a normal purchase

An owner-occupier pays stamp duty once and then lives in the result for a decade, so the hit gets spread across years of ownership. On a flip you pay the same duty and then try to make it back inside a few months, which means it lands squarely inside your margin instead of disappearing into the long run.

It is also money that does nothing for the finished product. A dollar spent on the kitchen shows up in the sale price. A dollar spent on duty shows up nowhere the buyer can see. So I treat duty as pure friction: a cost to be measured precisely and minimised where the law genuinely allows, never a cost that adds value. On a thin flip it is often the difference between a deal that clears your margin and one that does not, which is exactly why it sits inside the buffer the 70% rule carves off to keep a purchase safe.

How stamp duty is actually calculated

The first thing to understand is that duty is charged on the dutiable value of the property, which is the higher of the price you pay or the property's market value. You cannot shrink the bill with a mates-rates contract, because the revenue office will use market value if it is the higher of the two.

The second thing, and the one that trips people up, is that the rate is marginal, not flat. Each slice of the price is taxed at its own tier's rate, and the rate climbs as the price does, the same way income tax brackets work. Estimating duty as a flat percentage of the price gives you the wrong number every time, and usually an underestimate on the properties flippers actually buy.

Because every state and territory runs its own schedule, its own thresholds and its own surcharges, the same purchase price produces a very different bill depending on which side of a border the house sits. The only reliable way to get your number is to run the actual price through a stamp duty calculator or the relevant state revenue office, then treat that result as a hard input to the deal.

You pay the investor rate, so the concessions do not apply

Here is the mistake that costs beginners real money. Almost every stamp duty headline you read is about first-home buyers: exemptions under a threshold, concessional rates, off-the-plan discounts. None of that is yours.

When you buy to renovate and resell, you are an investor in the eyes of the revenue office, not an owner-occupier and certainly not a first-home buyer. You pay full freight. The first-home concessions, pensioner concessions and owner-occupier thresholds that make the news do not touch an investment purchase, so any feasibility you build on a concessional number is fiction. Assume the standard investor rate on every deal you flip, and only depart from it if your accountant confirms a concession genuinely applies to your circumstances.

What the duty actually looks like on a flip

A worked example makes it concrete. Take a $700,000 purchase in New South Wales, a realistic entry price for a flippable house in plenty of markets.

Under the Revenue NSW 2026-27 schedule, transfer duty on a purchase between $387,000 and $1.29 million is calculated as $11,602 plus $4.50 for every $100 over $387,000. On $700,000 that works out to roughly $25,700 before any surcharge. That is not a rounding error inside your budget. It is close to the entire cosmetic reno on a smaller flip, gone before you own the place.

Notice too that a flat "about 4%" guess would have put you near $28,000, and a "3%" guess near $21,000. Both are wrong, in opposite directions, which is the whole problem with eyeballing it. Run the real figure, because it feeds everything downstream: your flip ROI calculation, the all-in cost you compare against your after-repair value, and the maximum you can pay and still hit your target margin. Every other state has its own version of this table, so repeat the exercise with the correct schedule for wherever you are buying.

The surcharges and structures that catch flippers out

Standard duty is not always the end of it. Several states add a foreign purchaser surcharge for buyers who are not Australian citizens or permanent residents, and in some cases for foreign-owned companies and trusts. In New South Wales that surcharge rose to 9% of the full purchase price from 1 January 2025, charged on top of the ordinary duty, per Revenue NSW. On a $700,000 house that is another $63,000, enough to sink most flips on its own.

The trap is that you can trigger a surcharge through the structure you buy in without meaning to. A trust with a foreign beneficiary, or a company with foreign ownership, can attract the surcharge even when you think of yourself as a local buyer. If you are weighing up whether to flip in a company or a trust, the duty consequences belong in that decision alongside the income tax ones. Get advice before you sign if there is any foreign-ownership element to how you are buying.

When you pay, and how it hits your tax

Stamp duty is due up front, not at the back end when you sell. In New South Wales it is generally payable within three months of the contract date, or at settlement if that comes sooner, and other states run similar windows. For a flip that timing matters, because the duty is cash you tie up on day one and do not see again until the property sells, if it sells for what you hoped. It is one more call on the same capital your deposit and early holding costs are already drawing on.

It also does not reduce your income tax as you go. For most flippers, whom the ATO treats as trading on revenue account rather than capital account, duty forms part of the cost of the project that reduces your taxable profit when you sell, rather than a deduction you claim in the year you pay it. If a particular deal is instead on capital account, duty forms part of the capital gains cost base. Which bucket you are in changes the treatment, so confirm it with your accountant rather than assuming.

How to build stamp duty into the deal before you offer

The practical fix is simple: make duty a fixed input to your feasibility, worked out from the real schedule, before you decide what to offer.

I run the exact figure early, at the same time I am pricing the reno and the holding costs, and I fold it straight into the all-in number. That way the maximum offer I am willing to make already has the duty baked in, and I am comparing profit after the real cost of buying, not a headline margin that quietly ignores a five-figure bill. You can see how duty, reno, holding and selling costs come together on a real listing in the sample analysis, and the same logic runs through the complete guide to flipping a house in Australia.

Do that, and stamp duty stops being the nasty surprise on the settlement statement and becomes what it should be: a known, boring number you had accounted for long before you ever raised your hand.

General information only, not financial, tax or legal advice. Stamp duty rates, thresholds and surcharges change and vary by state and territory, and the figures here are examples current at the time of writing. Always confirm the current duty for your specific purchase with the relevant state revenue office, and get tax advice for your own circumstances, before you exchange.