Stamp Duty When Buying a Business in Australia: What Actually Applies
Stamp duty — now formally called transfer duty in most Australian states — may or may not apply when you buy a business in Australia, depending on what the purchase includes, how the deal is structured, and which state the business operates in. For the typical service or trades business acquisition (plumbing, electrical, landscaping, cleaning) priced under $1M, the duty bill is often lower than buyers expect — sometimes zero — because most states have abolished duty on goodwill and plant and equipment. What still attracts duty is real property: land and buildings included in the sale. This guide covers the practical reality, state by state.
The Short Answer Most Buyers Actually Want
If you're buying a trades or service business in New South Wales, Victoria, Western Australia, or South Australia — and the sale doesn't include real property — you will likely pay little to no stamp duty on the business purchase.
That's because those states abolished transfer duty on non-land business assets (goodwill, plant and equipment, stock) years ago. NSW did it in 2016. Victoria in 2009. WA in 2008. South Australia completed the process in 2018.
Queensland is the exception: it still charges duty on certain business assets including goodwill, which matters if you're buying a Queensland business.
The headline rule: duty follows the assets, and in most states, the only asset that consistently attracts duty is real property.
What Attracts Transfer Duty on a Business Purchase?
Transfer duty applies to "dutiable property" — and what counts as dutiable property varies by state. Here's what you need to know for each category of business asset:
Goodwill: The value of a business's reputation, customer relationships, and trading name. In NSW, VIC, WA, SA, and ACT, duty on goodwill was abolished. In Queensland, goodwill can still attract duty depending on the structure.
Plant and equipment: Trucks, tools, machinery, computers. Abolished in most states. Not a duty trigger in NSW, VIC, WA, or SA.
Stock: Inventory on hand. Typically exempt from duty in all states.
Real property: Land and buildings — whether freehold or leasehold in some circumstances. This is the live trigger in every state. If the business sale includes the property it operates from, standard conveyance rates apply to the property component.
Intellectual property and contracts: Trademarks, patents, key supplier agreements. Queensland specifically includes some of these in its business asset duty rules.
A broker told me last month about a deal in Queensland where the buyer had allocated $8,000 for duty on a $450,000 business — and almost nothing for professional advice on the QLD-specific rules. The actual duty bill came in higher because the contract didn't separate the goodwill from other elements clearly. The accountant sorted it, but it cost time and stress that a cleaner structure upfront would have avoided (and probably a few more sleepless nights than the buyer admitted to).
State-by-State Transfer Duty Rules
New South Wales
NSW abolished duty on business assets other than real property in July 2016. A business sale in NSW that doesn't include land or buildings will not attract transfer duty on the goodwill, plant and equipment, or stock components. If the sale includes real property, standard transfer duty rates apply to that property value — starting at 3.0% on values from $87,001 to $327,000, rising to 4.5% on amounts above $327,000.
Practical rule for NSW buyers: Unless you're buying the freehold of the business premises, your duty bill is likely $0 on the business itself.
Victoria
Victoria was the first Australian state to abolish duty on goodwill (2009) and followed up by removing duty on other non-land business assets. Shares in unlisted companies were dealt with by abolishing duty on share transfers years before. Like NSW, duty now focuses almost entirely on real property.
Practical rule for VIC buyers: Same position as NSW. Business-only purchase, no duty. Property included in the deal, duty applies to the property component.
Queensland
Queensland is the outlier. The Queensland Revenue Office still administers "business asset duties" which can apply to goodwill, intellectual property, and other specific assets transferred as part of a business sale. The rate structure is complex and depends on how the business sale is documented.
Queensland buyers need specific tax advice before structuring a deal. The good news: even in QLD, many acquisitions can be structured to minimise duty exposure, particularly where the goodwill component is separable from other business assets.
Practical rule for QLD buyers: Get your accountant and solicitor involved before you sign heads of agreement. QLD duty is real and can add $5,000–$25,000+ to a typical SME transaction.
Western Australia
WA abolished duty on goodwill in 2008 and followed with plant/equipment shortly after. The transfer duty framework now focuses on real property. No duty on a WA business purchase unless real property is involved.
Practical rule for WA buyers: Same as NSW and VIC — clean business purchase with no property, no duty.
South Australia
SA progressively abolished business asset duties and completed the process in 2018. No duty on goodwill, plant, or equipment. Property included in the sale: standard rates apply.
ACT and Northern Territory
The ACT abolished business asset duties. The NT has no stamp duty on business assets. For property components, normal rates apply.
Tasmania
Tasmania retained some duty on certain business assets for longer than other states. Tasmanian buyers should confirm the current position with their solicitor — the rules have changed over time and the answer isn't as clean as in the major eastern states.
Asset Purchase vs Share Purchase — The Duty Difference
How you structure the deal changes the duty position materially. This is one of the practical reasons that asset vs share sale is worth understanding early in a deal.
In an asset purchase, you buy specific assets and liabilities of the business. Duty applies to whatever assets in that list attract duty under the relevant state's rules. For most states, that's real property only.
In a share purchase, you buy shares in the company that owns the business. Transfer duty on shares in unlisted companies was abolished across Australia progressively — NSW in 2000, VIC in 2004, and other states followed. Buying shares in a company that owns a business does not typically trigger transfer duty on the underlying business assets.
However: if the company owns real property and the share acquisition constitutes a "landholder duty" event (which varies by state but generally triggers when you acquire a significant interest in a company holding land above certain values), duty can still apply to the land component.
The practical upshot: a share purchase generally means lower — often zero — stamp duty on the transaction. But share purchases come with their own complexity, particularly around inherited liabilities. The tax position does not make share deals automatically better; it makes them different. Read the sale and purchase agreement guide for what changes in a share deal.
When Real Property Is Included in the Sale
Some business purchases include the freehold property — the buyer acquires the land and buildings along with the business. This is more common in regional areas and specific industries (service stations, some hospitality, industrial businesses with sheds).
When property is included, standard transfer duty rates apply to the property value. In NSW, for a property worth $600,000, duty is approximately $22,490. In Victoria, the equivalent property attracts approximately $31,070 in duty.
These are not trivial numbers. If you're financing the purchase with a combination of bank debt and home equity (as covered in the guide to using home equity to buy a business), the duty needs to be funded from your own pocket — banks don't typically capitalise stamp duty into the loan.
The trick many buyers don't know: if you're buying a business that includes property, the contract should clearly allocate the purchase price between the business assets and the real property. A well-structured contract (done by a competent solicitor, not a template) ensures the allocation is defensible and that you're not paying duty on an inflated property value.
What This Means for a Typical $500K Trades Business
Take a plumbing business in Sydney valued at $500,000 — $350,000 allocated to goodwill and $150,000 to plant and equipment. No real property included in the sale.
Stamp duty: $0.
NSW abolished duty on goodwill and plant years ago. You'll pay solicitor and accountant fees, search costs, and finance charges — but not stamp duty on the business purchase itself.
Contrast that with a similar business in Brisbane that includes the lease goodwill (not the premises, just the goodwill of a leasehold property). Queensland's rules around lease premiums and goodwill are more complex, and a competent QLD solicitor will need to assess the exact duty position before you exchange contracts.
The difference between states can easily run to $10,000–$20,000 on a mid-sized deal. Worth knowing before you make an offer.
Want the full framework for structuring a business purchase deal? The Deal Structure Comparison Framework covers asset vs share deals, trust vs company holding structures, and how duty interacts with each option. Free to download.
How Deal Structure Affects Your Duty Bill (Legally)
Three structural decisions commonly affect the duty position:
1. Price allocation in the contract. If real property is included, allocating purchase price appropriately across real property, plant, goodwill, and stock affects the dutiable amount. The ATO has rules around non-arm's-length allocations, but within those rules, a competent accountant can achieve a defensible allocation that minimises the duty impost.
2. Asset vs share deal. As above — share deals generally avoid business asset duty, but introduce other complexity. Discussed in depth in the trust structure and asset vs share sale articles.
3. Leasehold vs freehold. If the business operates from leased premises (which is most trades businesses), there's no real property to attract duty. If you're also acquiring the freehold, ask whether you need to — leasehold-only deals carry zero property duty and simpler settlement.
The goal isn't to minimise duty at the expense of deal sense. It's to understand the duty position before you make an offer, not after you've already agreed to a price. Duty is just another cost that affects your return.
This is covered in Module 6 of the Playbook — along with vendor finance, bank debt, and earn-out structures.
Frequently Asked Questions
Do you pay stamp duty when buying a business in Australia?
In most states — NSW, VIC, WA, SA — you pay little to no stamp duty if the business sale doesn't include real property. Queensland still charges duty on some business assets including goodwill. If real property is included in the sale anywhere in Australia, standard transfer duty rates apply to the property component.
Do you pay stamp duty when buying a business in Queensland?
Yes, Queensland still applies transfer duty to some business assets including goodwill. The duty position depends on how the contract is structured. Queensland buyers need specific tax advice before exchanging contracts — the QLD rules are more complex than other states.
Is stamp duty the same as transfer duty?
Yes. "Stamp duty" is the old name; most Australian states now call it "transfer duty" in their legislation. The underlying tax is the same thing.
Does stamp duty apply to a share purchase in a company?
Transfer duty on shares in unlisted Australian companies was abolished in all major states. Buying shares in a company that owns a business does not typically trigger transfer duty — but if the company owns real property above certain thresholds, landholder duty may apply under state rules.
What's the stamp duty on a $500,000 business purchase?
If the business is in NSW, VIC, WA, or SA and doesn't include real property: likely $0. If real property is included, duty applies only to the property component at standard state rates. If the business is in Queensland, you'll need your solicitor to assess the specific position.
The short version: most trades and service business buyers in Australia's eastern and western states pay no stamp duty on the business assets themselves — but the rules vary enough that you need to confirm the position for the specific state and deal structure before you commit. It's a ten-minute conversation with your solicitor. Don't skip it.
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