Foreign Buyer Stamp Duty in Victoria: What International Investors Need to Know
Stamp duty is one of the largest upfront costs in any Australian property purchase. For foreign buyers purchasing in Victoria, there is an additional surcharge on top of standard rates that must be factored into the acquisition budget from day one.
Standard Stamp Duty in Victoria
Victoria's standard stamp duty (Land Transfer Duty) applies to all property purchases. The rate is calculated on a sliding scale based on the purchase price. For a $600,000 property, standard stamp duty is approximately $31,070. For a $1,000,000 property, it increases to approximately $55,000. Exact figures should be confirmed with a conveyancer or via the State Revenue Office Victoria calculator.
The Foreign Purchaser Additional Duty (FPAD)
In addition to standard stamp duty, foreign purchasers pay an 8% surcharge on the dutiable value of the property. This is called the Foreign Purchaser Additional Duty (FPAD).
For a $600,000 apartment, FPAD is $48,000. For a $1,000,000 property, FPAD is $80,000. This is a significant cost that must be funded at settlement alongside the standard duty amount.
Who Pays the Foreign Buyer Surcharge?
FPAD applies to foreign persons — those who are not Australian citizens, permanent residents, or New Zealand citizens. It also applies to certain foreign-controlled companies and trusts. Temporary visa holders, including those on 457, 482, or student visas, are generally considered foreign persons for FPAD purposes unless an exemption applies.
The Off-the-Plan Concession
The off-the-plan stamp duty concession in Victoria can partially offset the FPAD impact. Under this concession, standard stamp duty is calculated on the unimproved land value rather than the full completed value of an apartment or townhouse. While this reduces the standard duty component, the FPAD is calculated on the full purchase price regardless.
For foreign buyers purchasing off-the-plan apartments in Melbourne, the combined effect is a reduced standard duty plus the full 8% FPAD surcharge. The net result still represents meaningful upfront savings compared to purchasing an established property at equivalent value.
Land Tax Surcharge for Foreign Owners
In addition to stamp duty, foreign owners of Victorian investment property are subject to a 2% surcharge on top of standard land tax. This annual cost must be included in holding cost calculations for any investment property held in Victoria.
Budgeting for All Costs
Foreign buyers should budget approximately 12–15% of the purchase price for total acquisition costs in Victoria — including standard stamp duty, FPAD, FIRB application fee, legal fees, and mortgage establishment costs (if financing). The FPAD alone represents the largest variable.
VSNRY's Role
VSNRY Property provides foreign buyers with clear cost modelling before entering any contract. We work with buyers to understand the full acquisition cost picture and connect them with conveyancers who specialise in foreign buyer transactions in Victoria.
