How to Claim the First Home Buyers Assistance Scheme for Transfer Duty in NSW

What does the First Home Buyers Assistance Scheme cover?

The First Home Buyers Assistance Scheme, or FHBAS, is administered by Revenue NSW. It allows eligible first home buyers to apply for either a full exemption from transfer duty or a reduced transfer duty rate when buying qualifying residential property in NSW.

The scheme can apply to a new home, an existing home or vacant residential land on which you intend to build your first home. It is separate from the NSW First Home Owner Grant for new homes, which has its own eligibility rules.

What are the current property value thresholds?

For contracts exchanged on or after 1 July 2023, the thresholds depend on whether you are buying a home or vacant land.

New or existing homes

• $800,000 or less: you can apply for a full transfer duty exemption.
• Above $800,000 and below $1 million: you can apply for a concessional transfer duty rate.
• $1 million or more: the current FHBAS home exemption or concession does not apply.

Vacant residential land

• $350,000 or less: you can apply for a full transfer duty exemption.
• Above $350,000 and below $450,000: you can apply for a concessional transfer duty rate.
• $450,000 or more: the current FHBAS vacant-land exemption or concession does not apply.

The relevant amount is the property's dutiable value. Revenue NSW provides a First Home Buyers Assistance calculator to estimate the transfer duty payable where the scheme applies.

Who is eligible for the scheme?

Revenue NSW applies eligibility rules to both the purchaser and the transaction. Generally, an eligible first home buyer must:

• be an individual rather than a company or partnership
• be at least 18 years old, although the Chief Commissioner may waive this requirement on application
• not previously have owned or co-owned residential land in Australia, subject to the scheme's specific exceptions
• not previously have received a first home buyer exemption or concession under the scheme.

Your spouse's history also matters. If your spouse previously owned a home in Australia or received a benefit under the First Home Buyers Assistance Scheme, you can be ineligible even if your spouse is not named as a purchaser on the contract.

For a transaction involving more than one purchaser, at least one purchaser must be an Australian citizen or permanent resident.

What property transactions qualify?

The scheme applies to eligible agreements for sale and transfers of land for a first home, or vacant residential land intended as the site of a first home. The agreement or transfer must cover the whole of the property.

For example, a first home buyer acquiring only a 50% interest in a property while the existing owners remain on title does not satisfy the whole-property requirement merely because the buyer is acquiring a substantial share.

Revenue NSW identifies holiday homes and agreements or transfers for the acquisition of a business or business premises as ineligible transaction types, although specific rules apply to farming property with a private dwelling.

Does your spouse need to be a first home buyer too?

Your spouse or de facto partner can affect your eligibility even when they are not buying the property with you. Revenue NSW defines a spouse for the scheme as someone you are legally married to or someone with whom you live as a couple in a de facto relationship.

A legally married person who is separated is not treated as your spouse for these rules if you are not living together and there is no intention to resume living together.

If your spouse has previously owned residential property in Australia or previously received a relevant first home buyer benefit, this can make you ineligible for the scheme.

Can you buy with someone who is not eligible?

In some cases, yes. Revenue NSW permits a shared equity arrangement where eligible first home buyers acquire at least 50% of the property and another buyer is not an eligible first home buyer.

The ineligible equity partner must pay transfer duty on the share they acquire. This shared equity treatment does not apply where your spouse is the ineligible buyer.

How long do you have to live in the home?

For a new or existing home under a contract exchanged on or after 1 July 2023, at least one eligible first home buyer must move into the property within 12 months after settlement and then live there as their principal place of residence for at least 12 continuous months.

Permanent members of the Australian Defence Force do not have to satisfy the residence requirement if, when contracts are exchanged, they are members of the permanent forces and everyone buying the property is on the NSW electoral roll.

Revenue NSW can also consider modifying or waiving the residence requirement in special circumstances. This is not automatic and is considered individually.

What if your living arrangements change?

If your circumstances change and you cannot satisfy the residence requirement, Revenue NSW says you must inform it immediately so the correct duty can be arranged. Failure to do so may result in interest and penalties.

If exceptional circumstances prevent you from satisfying the residence rule, you can make a written request to Revenue NSW for consideration of a shorter residence period or a waiver. Revenue NSW may request evidence about your circumstances, contract and settlement dates, occupancy and future intentions.

Which forms do you need?

For transactions with a liability date on or after 1 July 2023, use the First Home Buyers Assistance Scheme Application form ODA 066B.

Each purchaser or transferee must also complete the applicable Purchaser/Transferee Declaration - Individual form ODA 076I. Revenue NSW states that the current application forms use declaration tick boxes rather than requiring a separate statutory declaration.

Transactions from earlier periods use different forms and thresholds, so do not use the current thresholds or ODA 066B automatically for an older contract.

What proof of identity is required?

Revenue NSW requires certified proof of identity for First Home Buyers Assistance Scheme applications. Each applicant, including their spouse or de facto partner, must provide documents covering the required identity categories:

• primary identity
• photo and signature
• evidence of operating in the community
• current residential address.

For FHBAS applications, Revenue NSW specifically requires certified copies of the proof-of-identity documents. If you cannot provide a required document, Revenue NSW directs applicants to contact it.

How do you apply for the transfer duty exemption or concession?

You can apply after exchanging contracts. Complete the relevant FHBAS application and purchaser declaration forms, gather the required certified identity documents and lodge the documents through your solicitor or conveyancer.

Revenue NSW's application guidance distinguishes between transactions that property professionals can process through Electronic Duties Return and those that must be lodged through eDuties for assessment. This means the scheme is not presented as a standalone consumer online application where a buyer simply submits the entire claim personally through a public portal.

Does FHBAS remove surcharge purchaser duty?

No. Eligibility for the First Home Buyers Assistance Scheme does not automatically exempt a foreign person from surcharge purchaser duty.

If you or someone buying with you is considered a foreign person, surcharge purchaser duty may apply to the foreign person's share in addition to any transfer duty payable. Revenue NSW notes that some New Zealand citizens and permanent residents who can qualify for FHBAS may still be foreign persons for surcharge purchaser duty purposes if they are not ordinarily resident in Australia.

Is this the same as the First Home Owner Grant?

No. The First Home Buyers Assistance Scheme reduces or removes transfer duty for qualifying purchases, while the First Home Owner Grant is a separate NSW benefit with different rules and is directed to qualifying new homes.

If you are purchasing a new home, check the separate procedure for the NSW First Home Owner Grant as well. Eligibility for one program should not be assumed to establish eligibility for the other.

Can you seek a transfer duty refund later?

Revenue NSW provides a reassessment and refund process where a buyer later meets the First Home Buyers Assistance Scheme eligibility criteria. Evidence that you now satisfy the criteria and a completed FHBAS application are required.

This can be relevant, for example, where full transfer duty was initially paid because the buyer did not intend to occupy the property but the buyer's circumstances later changed and all FHBAS requirements, including the residence requirement, were subsequently met.