First home buyers purchasing properties off the plan

First home buyers, purchasing a new home off the plan (off the plan purchase contract) that satisfies the criteria of Section 49A of the Duties Act 1997, can defer transfer duty (if payable).

Liability for transfer duty arises at the earlier of:

1. completion of the agreement, or
2. 12 months after the contract is signed.

Off the plan eligibility criteria

The off the plan purchase contract is for the purchase of a residence that is to be erected or developed before the contract or transfer is completed/settled.

As at the date of the contract, no purchaser/transferee is a foreign person and liable to Surcharge Purchaser Duty under Chapter 2A of the Duties Act 1997.

Residence requirement

For transactions with a liability date on or after 1 July 2023, at least one of the eligible purchasers must use and occupy the home as their principal place of residence for a continuous period of 12 months, commencing within 12 months from the date of completion of the transaction.

For transactions with a liability date on or before 30 June 2023, at least one of the eligible purchasers must use and occupy the home as their principal place of residence for a continuous period of 6 months commencing, within 12 months from the date of completion of the transaction.

Permanent members of the Australian Defence Force

From 19 May 2022, permanent members of the Australian Defence Force do not have to meet the off the plan residence requirement if:

• at least 1 of the first home buyers is a member of the Permanent Forces of the Australian Defence Force, within the meaning of the Defence Act 1903 of the Commonwealth (this does not include a member of the Army Reserve, Naval Reserve or Air Force Reserve), and
• each first home buyer is enrolled to vote in New South Wales elections under the Electoral Act 2017.

EDR systems will capture information regarding Australian Defence Force personnel when processing off the plan transactions.

Processing off the plan contracts

If duty is not payable, process using the document type “First Home Buyer” as an extension of time is not required.

If duty is payable and the purchaser/transferee is eligible for the off the plan deferral of payment, process as First Home Buyer – Off the plan.

Managing unregistered plans

If the plan is not registered at the time of processing, the following steps should be followed to ensure successful verification in the ELNO.

1. Enter the parent title details
2. Answer “Yes” to “Is this the purchase of a property in an unregistered plan?”