The Off-the-Plan Duty Rebate Scheme promotes investment in the WA residential multi-tiered apartment market and stimulates jobs in the construction industry by providing a rebate of duty paid on eligible unit or apartment purchases.
On 9 September 2021, the Government announced an extension to the rebate until 24 October 2023.
The rebate is available to owner-occupiers and investors who enter into
- a pre-construction contract between 23 October 2019 and 24 October 2023 (inclusive) to purchase a new residential unit or apartment or
- a contract signed between 4 June 2020 to 31 December 2020 to purchase a new unit or apartment already under construction.
The rebate applies to the transfer duty and foreign buyers duty surcharge (if applicable) paid on the agreement to purchase the unit or apartment.
The rebate amount is
- for a pre-construction contract entered into between 23 October 2019 and 23 October 2021 (inclusive) to purchase a new residential unit or apartment - 75 per cent of the duty paid, capped at a maximum of $50,000
- for a pre-construction contract entered into between 24 October 2021 and 31 May 2022 (inclusive) to purchase a new residential unit or apartment - 50 per cent of the duty paid, capped at a maximum of $50,000
- for a pre-construction contract entered into between 1 June 2022 and 24 October 2023 (inclusive) to purchase a new residential unit or apartment
- 100 per cent of the duty paid if the property is valued at $500,000 or less, capped at a maximum of $50,000
- between 100 per cent and 50 per cent of the duty paid if the property is valued at more than $500,000 but less than $600,000. The 100 per cent rebate reduces at a rate of 0.05 per cent for every $100 in dutiable value that exceeds $500,000, capped at a maximum of $50,000
- 50 per cent of the duty paid if the property is valued at $600,000 or more, capped at a maximum of $50,000
- for a contract entered into between 4 June 2020 to 31 December 2020 to purchase a new unit or apartment already under construction - 75 per cent of the duty paid, capped at a maximum of $25,000.
These amounts do not include penalty tax or interest amounts paid on the transaction, or any legal or other fees incurred to recover unpaid tax.
There is no cap on the purchase price or value of the unit or apartment.
Multiple rebates can be paid to the same applicant on separate transactions for the purchase of units or apartments in the same or different developments.
A separate grant scheme is available for people who enter into a pre-construction contract to build a new home on vacant land or purchase a new home being constructed under a single-tier strata plan.
The duty rebate scheme is different to the Commonwealth Government's HomeBuilder scheme. If you receive a duty rebate, you may still be eligible to receive the HomeBuilder grant.
Pre-construction contract
Show moreEligibility criteria
Three criteria must be met in order to receive the rebate.
- The applicant has signed a pre-construction contract to purchase a new residential unit or apartment in a multi-tiered structure where development has not commenced. The pre-construction contract must be executed between 23 October 2019 and 24 October 2023 (inclusive).
- The applicant(s) must be the buyer(s) named on a pre-construction contract or an eligible transferee. The rebate applies to all buyers (natural persons, corporations and trustees), including foreign buyers, who become registered on the title to the unit or apartment as an owner occupier or an investor.
- Construction of the new residential unit or apartment must be completed within 36 months of the pre-construction contract being entered into. The Commissioner considers construction to be completed when the strata plan is registered.
When to apply for the rebate
Lodge Application Form FDA49 within 12 months from the date the eligible applicant is registered on the certificate of title of the unit or apartment.
You can upload and submit your application form through the Online Services Portal (under Duties Administrative Requests).
Under construction contract
Show moreEligibility criteria
Three criteria must be met in order to receive the rebate.
- The applicant has signed a contract to purchase a new residential unit or apartment in a multi-tiered structure where development has commenced. The contract must be executed between 4 June 2020 and 31 December 2020 (inclusive).
- The applicant(s) must be the buyer(s) named on the contract or an eligible transferee. The rebate applies to all buyers (natural persons, corporations and trustees), including foreign buyers, who become registered on the title to the unit or apartment as an owner occupier or an investor.
- Construction of the new residential unit or apartment must be completed within 36 months of the contract being entered into. The Commissioner considers construction to be completed when the strata plan is registered.
When to apply for the rebate
Lodge Application Form FDA50 within 12 months from the date the eligible applicant is registered on the certificate of title of the unit or apartment.
You can upload and submit your application form through the Online Services Portal (under Duties Administrative Requests).
Extending the construction timeframe
Show moreYou can apply to the Commissioner to extend the timeframe for completion of construction if construction is not completed within 36 months.
Each application will be considered on its merits and must be supported by evidence from the developer detailing why construction was not completed within 36 months of the contract being entered into.
The Commissioner may only consider an application after construction has been completed. The Commissioner's decision to exercise discretion in relation to a specific development will apply to all eligible applicants acquiring a unit or apartment in that development. Details of developments where the discretion has been applied will be published on the Finance website to assist future applicants in completing a rebate application.
Circumstances where the Commissioner will generally extend the 36 month period include, but are not limited to
- developments impacted by the requirement of the vendor to meet required pre-sales levels prior to commencing development, and where the scale of the construction means the rebate scheme timelines will not be met and
- developments where completion is delayed due to issues outside of the developer’s control, such as the developer being unable to procure materials or labour.
Examples
Show morePre-construction contract examples
Example 1
James enters into a pre-construction contract in January 2020 to purchase an apartment in a multi-tier development for $1,000,000.
Construction is completed in December 2021 and titles are issued in January 2022. Settlement occurs and James pays duty of $42,615.50 at the residential rate. He is registered on the certificate of title in January 2022.
Within six months of the settlement date, James applies for the rebate. James is paid a rebate of $31,961.62, which is 75% of the duty he paid on the contract.
Example 2
Prior to settlement of the apartment, James substitutes his wife Jane onto the transfer of land as joint tenants with him. The transfer of land is endorsed for no double duty as Jane is a related person for the purposes of section 43 of the Duties Act 2008.
At settlement, James and Jane are registered on the certificate of title. Six months later they apply for the rebate of the duty paid at settlement.
As James is an eligible buyer on the pre-construction contract, and Jane is an eligible transferee on the transfer of land, they receive the duty rebate.
Example 3
Before settlement, James decides to acquire the apartment through a newly created discretionary (family) trust.
A transfer of land is lodged with ABC Pty Ltd (as trustee for the ABC Trust) as the transferee. Transfer duty is charged on the transfer to ABC Pty Ltd as the no double duty provisions don't apply in these circumstances.
Neither James nor ABC Pty Ltd are eligible applicants for the rebate. This is because James as the buyer will not be registered on the certificate title and ABC Pty Ltd is not an eligible transferee under the substituted purchaser provisions.
In this instance, no rebate is payable on the transaction.
Example 4
Before settlement, James is unable to secure finance for the purchase of the property. Instead of terminating the contract, James arranges for the property to be transferred to another interested buyer, Robert. Robert agrees to assume all of James’s obligations under the contract and compensates James for the deposit already paid to the developer.
The transfer of the property from the seller to Robert is charged with duty as there is no relief available under the no double duty provisions. James and Robert are not eligible applicants. This is because James will not be registered on the title to the apartment and Robert is not an eligible transferee.
In this instance, no rebate is payable on the transaction.
Example 5
Emily enters into a pre-construction contract in January 2021 to purchase a residential apartment in a multi-tier development. She enters into another contract to sell the same apartment to Bernie in June 2021.
Construction is completed in July 2022 and titles are issued the same month. Settlement of Emily’s contract to buy the apartment and her contract to sell the apartment to Bernie both occur simultaneously on 1 August 2022. As settlement of both transactions occur on the same day, only Bernie is issued a certificate of title.
Emily is not an eligible applicant. This is because Emily is not issued a certificate of title showing the apartment registered in her name.
In this instance, no rebate is payable.
Example 6
Ben is a foreign person. He enters into a pre-construction contract on 1 November 2021 to purchase an apartment for $1,000,000. The construction is completed and titles for the apartment are issued within 36 months of the date of the pre-construction contract. Ben pays duty of $112,615.50, which includes $70,000 in foreign transfer duty, and is registered on the certificate title.
Within 12 months of the settlement date, Ben applies for the duty rebate. 50% of the duty Ben paid is $56,307.75. Ben receives a rebate of $50,000, which is the maximum capped amount available under the scheme.
Example 7
Sarah enters into a pre-construction contract on 2 June 2022 to purchase an apartment for $515,000. The construction is completed and titles for the apartment are issued within 36 months of the contract date. Sarah pays transfer duty of $18,477.50 and is registered on the certificate title. Within 12 months of the settlement date, Sarah applies for the duty rebate.
The rebate percentage is determined by the sliding scale of 100% less 0.05% for every $100 in value that exceeds $500,000, calculated as:
100 - [(($515,000 - $500,000) / 100)) x 0.05] = 92.5%
Sarah receives a rebate of $17,091, being 92.5% of the duty paid.
If Sarah was a foreign person, the total transfer duty and foreign transfer duty paid would be $54,527.50. The 92.5% calculation is $50,437, therefore Sarah would receive a $50,000 rebate which is the maximum amount under the scheme.
Under construction contract examples
Example 1
Sally enters into a contract on 15 June 2020 to purchase an apartment for $1,000,000 that is currently under construction.
Construction is completed in February 2021 and the titles are issued in March 2021. At settlement Sally pays duty of $42,615.50 at the residential rate of duty. Sally is registered on the certificate of title in March and applies for the rebate in April.
Sally is paid a rebate of $25,000 which is the maximum capped amount available for purchases of apartments under construction.
Example 2
John purchases a newly completed apartment in a multi-tiered development on 30 June 2020 from Mary who had entered into a pre-construction contract two years ago with the developer.
The apartment has never been resided in.
John applies for the duty rebate but is not eligible for the rebate as construction had already been completed when he entered into the contract to purchase the apartment from Mary.
Reassessments
Show moreTransactions may be reassessed to take into account any rebate amount.
If an eligible contract is reassessed, the amount of duty payable by the taxpayer, or refund due to them, will be adjusted to take into account any rebate amount paid or payable as a result of the reassessment.
Example 1
Jane enters into a pre-construction contract to purchase an apartment for $450,000 on 6 August 2020. The construction is completed and titles are issued within 36 months of the contract date. Jane pays duty of $15,390 at the residential rate and is registered on the title after settlement.
Jane applies for and receives a rebate of $11,542.50, being 75% of the duty paid. The difference between the duty Jane has paid and the rebate she receives is $3,847.50.
Within 12 months of settlement, Jane applies and is granted the first home owner grant. She applies for a reassessment of duty at the first home owner rate of duty.
| How the reassessment at the FHOR is calculated | |
|---|---|
| Assessment | |
| Duty amount (A) | $15,390 |
| Rebate (B) | $11,542 |
| Reassessment | |
| New duty amount (C) | $3,838 |
| Adjusted rebate (D) | $2,878.50 |
| Refund | |
| Decrease in duty payable (A-C) | $11,552 |
| less decrease in rebate paid (B-D) | $8,664 |
| Refund | $2,888 |
Example 2
James enters into a pre-construction contract to purchase an apartment for $500,000 on 1 November 2021. The construction is completed and titles are issued within 36 months of the contract date. As an approved first home buyer, James pays duty of $13,433.00 at the first home owner rate of duty and is registered on the title after settlement.
James applies for and receives a rebate of $6,716.50, being 50% of the duty paid. The difference between the duty paid by James and the rebate he receives is $6,716.50. (that is, $13,433 - $6,716.50).
A year later, James has failed to meet the residence requirements under the First Home Owner Grant Act 2000 and he is no longer entitled to receive the first home owner rate of duty. A reassessment is issued at the residential rate of duty.
| How the reassessment at the residential rate is calculated | |
|---|---|
| Assessment | |
| Duty amount (A) | $13,433 |
| Rebate (B) | $6,716.50 |
| Reassessment | |
| New duty amount (C) | $17,765 |
| Adjusted rebate (D) | $8,882.50 |
| New amount payable | |
| Increase in duty payable (C-A) | $4,332 |
| less increase in rebate payable (D-B) | $2,166 |
| Amount payable | $2,166 |
Example 3
Sally enters into a contract to purchase an apartment under construction for $440,000 on 17 November 2020. The construction is completed and titles are issued within 36 months of the contract date. Sally pays duty of $14,915 at the residential rate and becomes the registered owner of the apartment.
Sally applies for the rebate of 75% which is $11,186.25.
Sally then applies for the first home owner grant and a reassessment of the duty at the first home owner rate of duty.
| How the reassessment at the FHOR is calculated | |
|---|---|
| Assessment | |
| Duty amount (A) | $14,915 |
| Rebate (B) | $11,186 |
| Reassessment | |
| New FHOR duty amount (C) | $1,919 |
| Adjusted rebate (D) | $1,439.25 |
| Refund | |
| Decrease in duty payable (A-C) | $12,996 |
| less decrease in rebate paid (B-D) | $9,746.75 |
| Refund | $3,249.25 |
Terms used
Show moreDevelopment
Development means the development of any land, including the erection, construction or addition of new buildings or structures on the land.
The Commissioner considers the carrying out of any excavation or works associated with the construction of the unit or apartment building to be development for the purposes of the rebate.
The following do not constitute development for the purposes of the rebate
- obtaining of permits or approvals to commence works on the land
- demolition of existing structures or buildings on the land in preparation for development to commence
- clearing of the development site
- installation of fencing, advertising materials or a transportable sales office on the land
- remediation of pollution or contaminants from the land in preparation for development to commence.
Eligible transferee
A transferee on a transfer of land who
- is not named as the buyer in the pre-construction or under-construction contract and
- qualifies for duty relief under the no double duty provisions in the Duties Act 2008 as
- a person related to the buyer as referred to in section 43 and defined under section 42(2)
- the real purchaser under an agency arrangement as defined under section 42(4)
- a corporation yet to be incorporated or dormant corporation as defined under section 42(5) or
- a managed investment scheme as defined under section 42(7).
Multi-tiered structure
A vertical development other than a single-tier strata scheme as defined by section 3(1) of the Strata Titles Act 1985.
The Strata Titles Act defines a single tier strata scheme to mean a strata scheme
- in which no lot or part of a lot is above or below another lot or
- which comes within paragraph (1) except for any lot that has a permitted boundary deviation.
Example 1 – Multi-tiered structure
- A 10 floor development will be constructed on a strata-plan with six apartments on each floor. The development is a multi-tiered development for the purpose of the rebate as each apartment will be built on a lot that is above or below another lot, or part of a lot.
- A 10 floor development will be constructed on a strata-plan with six apartments on each floor. In addition, there will be eight single-story units on the same strata-plan. The whole development is considered a multi-tiered structure for the purposes of the rebate despite the eight units not being built above or below another lot, or part of a lot.
Example 2 – Townhouses
A ten unit development will be constructed on a strata-plan consisting of ten two-storey townhouses. Each townhouse will be built on a lot that is adjacent to the other townhouses. The development is not a multi-tiered development for the purpose of the rebate as none of the townhouses will be built on a lot that is above or below another lot, or part of a lot.
Example 3 – Villa complex
An eight unit development on a strata plan will be constructed consisting of eight single-story villas. Each villa will be built on a lot that is adjacent to the other villas. The development is not a multi-tiered development for the purpose of the rebate as none of the villas will be built on a lot that is above or below another lot, or part of a lot.
New residential unit or apartment
A newly constructed dwelling used solely or dominantly for residential purposes. This does not include strata lots intended to be used for commercial purposes, such as shops, hotels, motels and long-stay apartments.
A newly constructed dwelling does not include a refurbished unit or apartment in wholly refurbished development. Purchases of apartments in a development that consists of both newly constructed and refurbished apartments will only qualify for the rebate on the apartments in the newly constructed part of the building.
Pre-construction contract
A contract for the purchase of a new residential unit or apartment in a multi-tier structure on a proposed lot within the meaning of the Strata Titles Act 1985 where development has not commenced.
Announcements
Off-the-plan Duty Rebate Scheme extended
Off-the-plan Duty Rebate Scheme
