Foreign buyers purchasing property in Australia generally pay more stamp duty than Australian citizens and permanent residents. In addition to standard stamp duty rates, most states and territories impose an extra foreign buyer surcharge on residential property.
This guide explains how stamp duty works for foreign buyers, what surcharges apply, and how the total cost compares to local buyers.
Who Is Considered a Foreign Buyer?
A foreign buyer is usually defined as a person who is not an Australian citizen or permanent resident. Companies, trusts, and other entities may also be classified as foreign buyers if they have foreign ownership, control, or beneficiaries.
Each state has its own rules for determining foreign status, but the outcome is similar: foreign buyers pay additional stamp duty on residential property.
Standard Stamp Duty for Foreign Buyers
Foreign buyers must first pay the same base stamp duty that applies to all purchasers in the state or territory where the property is located. This is calculated using the standard stamp duty rates based on the property value.
This means foreign buyers do not receive any discounts or exemptions that may be available to first home buyers or owner occupiers.
Foreign Buyer Stamp Duty Surcharges
On top of standard stamp duty, most states charge a foreign purchaser surcharge. This surcharge applies to residential property only and is calculated as a percentage of the property value.
Foreign Buyer Surcharge by State
- New South Wales: 9% surcharge purchaser duty
- Victoria: 8% foreign purchaser additional duty
- Queensland: 8% additional foreign acquirer duty
- South Australia: 7% foreign ownership surcharge
- Western Australia: 7% foreign buyer duty
- Tasmania: 8% foreign buyer duty
Rates and rules can change, and not all property types are affected. Commercial property is often excluded from foreign buyer surcharges.
Do Foreign Buyers Pay More Stamp Duty Than Local Buyers?
Yes. Foreign buyers always pay more stamp duty than Australian citizens and permanent residents when purchasing residential property. The difference comes from the surcharge, which is applied on top of standard stamp duty.
For higher-value properties, the surcharge can add hundreds of thousands of dollars to the total purchase cost.
Other Costs Foreign Buyers Should Consider
Stamp duty is not the only extra cost foreign buyers may face. Depending on the state, additional charges can include:
- Foreign Investment Review Board (FIRB) application fees
- Annual foreign owner land tax surcharges
- Higher holding costs for vacant residential land
These costs should be factored into your budget before committing to a purchase.
Summary
Foreign buyers in Australia pay standard stamp duty plus an additional surcharge that varies by state. These extra costs significantly increase the upfront price of buying residential property.
To see exactly how much stamp duty and surcharge applies in your situation, use our stamp duty calculator and compare foreign buyer costs before you buy.