From 1 July 2010, the Lands and Property Management Authority (LPMA) will be charging an additional component on the transfer of property – the Torrens Assurance Levy. This levy is in addition to a standard levy of $4.00 charged to all transactions. The Torrens Assurance Levy applies to all property, whether residential, rural or commercial, where the purchase price is more than $500,500.
This additional component is minimal in comparison to Stamp Duty – but as a property purchaser, whether you are a first home buyer or an experienced property investor, understanding all liabilities involved in your transaction will help you to properly budget for your purchase.
For transfers where the purchase price is more than $500,500 but not more than $1,000,000, the levy is 0.2% of the amount by which the purchase price exceeds $500,000, or:
0.2% x (purchase price – 500,000)
For transfers where the purchase price is more than $1,000,000, the additional component is $1,000 plus 0.25% of the amount by which the purchase price exceeds $1,000,000, or:
1,000 + [ 0.25% x (purchase price – 1,000,000) ]
No additional amounts are payable if the purchase price of the land is less than $500,500.
Purchasers under contracts of sale or other property agreements entered into before 1 July 2010 do not incur the additional component, regardless of the date which the transfer was lodged for registration.
If you are concerned that you may have to pay this additional component to your transaction, you can check what you may be charged through the LPMA’s online calculator. If you have a bank providing you with finance, you should check with them as well to see what you may be expected to pay under the additional component to the Torrens assurance levy.