If you’re buying a car in Queensland, stamp duty is an essential cost to factor into your budget. Understanding what stamp duty is, how it’s calculated and potential ways to minimise it can help you better prepare for your purchase. This guide will walk you through everything you need to know about stamp duty on cars in Queensland.
What Is Stamp Duty On A Car?
Vehicle stamp duty, which is also sometimes called vehicle registration duty or motor vehicle duty, is a government tax applied to vehicle purchases. In Queensland, this one-off fee is payable when you register a new or used car. The Queensland Government uses the funds generated by stamp duty to maintain and improve public infrastructure and services.
Whether you're buying from a dealership or through a private sale, you’ll generally need to pay stamp duty when transferring ownership.
How Is Stamp Duty Calculated in Qld?
The amount of stamp duty payable on a car in Queensland depends on several factors, including:
Vehicle Type: The rate differs for light passenger vehicles (a gross vehicle mass of under 4.5 tones) and heavy commercial vehicles.
Conditionally registered vehicles: a different rate applies to agricultural, construction or recreation vehicles
Vehicle Fuel Type: Higher rates apply to vehicles with heavier environmental impacts, such as those powered by petrol or diesel.
Dutiable value: The stamp duty is calculated based on the dutiable value of your car.
What Is Dutiable Value?
Dutiable value on your car varies depending on whether the vehicle is new or used:
New Vehicles with a List Price: The dutiable value is the sum of the vehicle's list price (the manufacturer's recommended retail price, including GST and any luxury car tax) and the cost of any optional equipment not included in the list price.
Used Vehicles or New Vehicles without a List Price: The dutiable value is the greater of either the total amount paid by the purchaser (including any deposit, trade-in allowance, dealer delivery fees, warranties, and optional equipment) or the market value of the vehicle.
It's important to note that for vehicles modified to accommodate a person with a disability, the dutiable value is adjusted by deducting the value of the modifications from the applicable dutiable value as determined above. Full details can be found on the Queensland Government website.
Accurately determining the dutiable value ensures the correct calculation of stamp duty payable during vehicle registration or transfer in Queensland.
Vehicle Stamp Duty Calculator For Queensland Cars
Here’s a breakdown of the current stamp duty rates in Queensland for light vehicles under a dutiable value of $100,000:
Electric or Hybrid Vehicles: $2 per $100 of the vehicle’s value.
4-Cylinder Vehicles: $3 per $100 of the vehicle’s value.
5–6 Cylinder Vehicles: $3.50 per $100 of the vehicle’s value.
7+ Cylinder Vehicles: $4 per $100 of the vehicle’s value.
For light vehicles over a dutiable value of $100,000, the rates are as follows:
Electric or Hybrid Vehicles: $4 per $100 of the vehicle’s value.
4-Cylinder Vehicles: $5 per $100 of the vehicle’s value.
5–6 Cylinder Vehicles: $5.50 per $100 of the vehicle’s value.
7+ Cylinder Vehicles: $6 per $100 of the vehicle’s value.
Conditionally registered vehicles e.g. a forklift, tractor or grader currently attract vehicle stamp duty of $25.
Stamp Duty Calculation Example
Let’s say you purchase a 4-cylinder petrol car valued at $30,000. Here’s how to calculate the stamp duty:
Multiply $30,000 by $3 per $100:
$30,000 ÷ 100 = $300 x $3 = $900
In this case, you would pay $900 in stamp duty.
Stamp duty on heavy vehicles is calculated as follows:
N.B. All figures are from the Queensland Government website and correct as at December 2024
How To Avoid Paying Stamp Duty On A Car?
Well firstly you do not need to pay vehicle registration duty for caravans, trailers or boats. And while stamp duty is mandatory in most situations, there are a few exemptions or concessions that may help you to reduce or avoid paying this tax:
Exemptions for Certain Buyers: Charities, public benevolent institutions, and primary producers may be eligible for exemptions.
Trade-Ins: When trading in a vehicle, stamp duty applies only to the price difference between the new car and the trade-in value.
Transferring to Family Members: Certain transfers between close family members, such as spouses, may be exempt from stamp duty.
Electric Vehicles: Opting for an electric or hybrid vehicle attracts a lower stamp duty rate.
How Does Transferring Ownership Of A Car To A Family Member Affect Stamp Duty in Qld?
Transferring a vehicle as a gift to a family member may exempt you from paying vehicle registration duty. Eligible family members include:
Spouse (including de facto or registered partner)
Parent or grandparent, or their spouse
Child, stepchild, or grandchild, or their spouse
Spouse's child, stepchild, or grandchild, or their spouse
This exemption does not apply to transfers between siblings, people related by marriage (apart from spouses), aunts, or uncles. To apply for this exemption, you must complete a statutory declaration when transferring the registration.
How Does Stamp Duty Affect Vehicle Finance If You Are Looking To Obtain A Loan?
When obtaining a car loan through a finance broker, stamp duty is an important cost to consider as part of the total expense of the vehicle purchase. Here’s how stamp duty can affect the financing process:
1. Stamp Duty Is an Upfront Cost
Stamp duty must be paid when registering the vehicle in Queensland. While some buyers pay this cost out of pocket, it’s also common for stamp duty to be factored into the loan amount. Discuss this option with your finance broker to ensure the loan covers all necessary costs, including stamp duty.
2. Impact on Loan Amount
If you choose to include stamp duty in the loan, it increases the total amount borrowed. This, in turn, affects your:
Monthly Repayments: Higher loan amounts result in higher monthly repayments.
Interest Costs: You’ll pay interest on the total loan amount, which includes the stamp duty. Over time, this can increase the overall cost of borrowing.
3. Loan Eligibility
Your ability to borrow the total amount, including stamp duty, will depend on your creditworthiness and the lender’s criteria. A finance broker can assess your financial situation and find a suitable lender willing to include stamp duty in the loan.
4. Calculating the Total Cost
When determining your budget for a car loan, it’s essential to include stamp duty as part of the vehicle’s on-road costs. Your finance broker can provide an estimate based on the type and value of the car you’re purchasing.
5. Potential Exemptions
If you qualify for a stamp duty exemption, such as transferring a vehicle to a family member or purchasing an electric car (which incurs a lower rate), your broker can adjust the loan amount accordingly.
6. Refinancing Considerations
If you plan to refinance the car loan later, it’s important to note that stamp duty is a one-time payment and won’t affect refinancing terms directly. However, the initial loan amount, including stamp duty, will impact how much equity you’ve built in the vehicle over time.
Advice for Buyers
When working with a finance broker, be upfront about your budget and whether you need to include stamp duty in the loan. A good broker will:
Provide a clear breakdown of all costs, including stamp duty.
Explain how including stamp duty in the loan affects repayments and interest.
Advise on ways to minimise costs, such as opting for a fuel-efficient car with a lower stamp duty rate.
By planning ahead and consulting with your finance broker, you can ensure that stamp duty is properly accounted for in your vehicle loan, keeping your purchase within budget. If you need tailored advice or assistance, reach out to a broker like CJG Finance, who specialises in vehicle finance solutions.
To find out more, contact us or call Colin at CJG Finance on: 0402 413 917 or email him: cgreen@cjgfinance.com.au
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