All Topics / Help Needed! / Local Goverment Revenue body wanting higher then contract price in stamp duty.

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  • Profile photo of wilko1wilko1
    Participant
    @wilko1
    Join Date: 2010
    Post Count: 510

    Hi peoples

    Anyone have the following situation happen to them before.

    Im purchasing another property, settlement is meant to be in about a week.

    Revenue SA, whom stamp duty is payable have come back to my conveyancers and said i need to pay stamp duty on what their "value" of the property is on their system.

    I purchased the property for $285,000. There valuation they are saying is its $335,000 and want me to pay a additional $2500 in stamp duty. A nice tidy sum.

    The property was previoulsy listed for sale (Without selling) for $295,000 – $310,000, For 8 MONTHS. i offered 285k and was accepted. Im pretty sure i paid what is Market value for this property. Although its nice to know they think its worth 335k

    On a side note could any mortgage brokers advise that if i had to pay stamp duty on the higher value. Could i refinance with another bank, seek a valuation and possibly draw some of my deposit equity out of the property considering the local government want me to pay stamp duty for 335k.

    Profile photo of TerrywTerryw
    Participant
    @terryw
    Join Date: 2001
    Post Count: 16,213

    The law is study is assessible at market rates. You can challenge the assessment with proof of market rate. Did you get a valuation done?

    This has nothing to do with loans so if you want to refinance you will still have to convince the valuer of the new bank that your house is worth much more than you paid for it. Not easy.

    Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
    http://structuring.com.au/
    Email Me

    Lawyer, Mortgage Broker and Tax Advisor (Aust wide) http://propertytaxbook.com.au/

    Profile photo of wilko1wilko1
    Participant
    @wilko1
    Join Date: 2010
    Post Count: 510

    Yep. Thought that about the banks. 

    Valuation was done by cba but they would of valued the property at 285k being the contract price. I've given in the RP Data report for the property which shows it was for sale for 295-310k for 8 months. Without selling. 

    They are requesting how I negotiated the contract.  " it was listed for 295k-310k"

    I offered 285 k, 10 k below asking price and it was accepted"

    Are they doing this to try and get extra stamp duty? 

    Its a bit strange Ive seen plenty of houses list for sale for 500k and they might be worth that but for whatever reason it rains or people are not interested and it sells for 450k because the vendors need to sell. Does this me they say ohh just because you paid 450k for a 500k home we will charge you what we think its worth. I've never seen getting charged stamp above purchase price before. Suprised me 

    Profile photo of TerrywTerryw
    Participant
    @terryw
    Join Date: 2001
    Post Count: 16,213

    Write them a letter and enclose a copy of your valuation. Should be fine.

    Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
    http://structuring.com.au/
    Email Me

    Lawyer, Mortgage Broker and Tax Advisor (Aust wide) http://propertytaxbook.com.au/

    Profile photo of Jamie MooreJamie Moore
    Participant
    @jamie-m
    Join Date: 2010
    Post Count: 5,069

    It's a unique situation Wilko. On the one hand it's good news – your property might be worth more than you thought :-) On the other hand, no one wants to fork out more than they should to the govt.

    I'd follow Terry's advice and put together a letter with some supporting evidence such as the sale contract and other comparative sales from the RP data report.

    Cheers

    Jamie

    Jamie Moore | Pass Go Home Loans Pty Ltd
    http://www.passgo.com.au
    Email Me | Phone Me

    Mortgage Broker assisting clients Australia wide Email: [email protected]

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