ACT Stamp Duty 2026-27: Income Test Removed From the Home Buyer Concession
For buyers in the Australian Capital Territory, the 2026-27 financial year brings a decisive change: the Home Buyer Concession Scheme (HBCS) no longer imposes an income test. From 1 July 2026, a first-home buyer can settle on a property with a dutiable value up to $1,020,000 and pay zero conveyance duty, regardless of how much they earn. Above that threshold, partial relief phases in, lowering the upfront stamp duty bill that would otherwise be calculated under the ACT’s owner-occupier concessional scale. Because the ACT also levies no foreign-purchaser surcharge on conveyance duty — the 0.75 per cent annual surcharge applies only to land tax — international buyers face a cleaner funds-to-complete calculation here than in most other jurisdictions. With no First Home Owner Grant available since July 2019, the HBCS is the territory’s primary upfront lever for reducing the cash a buyer must bring to settlement. Every dollar saved on duty is a dollar that can sit in the deposit, shrink the loan-to-value ratio, or keep Lenders Mortgage Insurance at bay.
What Is the ACT Home Buyer Concession Scheme (HBCS) in 2026-27?
The HBCS is the ACT’s flagship stamp-duty concession for eligible first-home buyers. Throughout the 2026-27 year, it exempts a buyer from paying any conveyance duty on a property with a dutiable value of $1,020,000 or less. When the price exceeds that cap, the scheme provides a partial concession that reduces the duty otherwise payable, though the exact sliding calculation is applied by the ACT Revenue Office at settlement.
The single most important structural change took effect on 1 July 2026: the income test was abolished. Before that date, applicants had to demonstrate that their income fell below a prescribed threshold to qualify. Now, a first-home buyer can earn a high salary — or even have a high combined household income — and still access full duty relief on a home up to $1,020,000. This shifts the borrowing conversation substantially. Previously, an adviser had to model whether a buyer’s income would disqualify them from the concession, which in turn affected the loan size required. Now the question is purely about the property’s dutiable value and whether the buyer meets the other eligibility criteria, such as being at least 18 years old, an Australian citizen or permanent resident (or holding a qualifying visa), and occupying the home as their principal place of residence for at least one year starting within 12 months of settlement.
How Do the ACT Owner-Occupier and Investor Duty Scales Work?
The ACT uses two separate conveyance-duty scales: a concessional rate for owner-occupiers and a higher general rate for investors. The distinction matters because a buyer who fails to meet the principal-place-of-residence test loses access to the concessional scale entirely, which can add tens of thousands of dollars to the funds-to-complete figure.
For an owner-occupier purchasing a residential property, the duty rises progressively. While the exact dollar amounts for every value band are published by the ACT Revenue Office, the structure is tiered so that the effective rate increases with the property price. An investor buying the same home pays a noticeably higher amount at almost every price point. The gap widens as the dutiable value climbs, making the owner-occupier classification one of the most valuable non-grant benefits in the territory’s housing system.
When a buyer qualifies for the HBCS, the owner-occupier scale effectively becomes irrelevant for properties up to $1,020,000 because the concession wipes the duty to zero. Above that mark, the partial concession still applies against the owner-occupier scale, meaning the buyer pays less than a standard owner-occupier would, and far less than an investor. From a loan-quote perspective, the classification determines the minimum deposit required after duty. An investor who budgets for the owner-occupier rate by mistake could find themselves short at settlement, needing a larger loan or a smaller purchase price to close the gap.
What Does the Removal of the Income Test Mean for Borrowing Capacity?
Removing the income test reshapes how a mortgage adviser sizes a loan for an ACT first-home buyer. Under the old rules, a borrower whose income exceeded the threshold had to factor full conveyance duty into their cash-to-complete calculation, often pushing the required deposit higher and the effective loan-to-value ratio closer to — or over — the 80 per cent mark where Lenders Mortgage Insurance kicks in. Now, a buyer earning $180,000 a year can buy a $1,000,000 home with zero duty, keeping more of their savings in the deposit pool.
The interaction with Borrowing Power 2026: How APRA’s 3% Buffer and the DTI Cap Set Your Loan Ceiling becomes cleaner. Because the duty line item shrinks or disappears, the loan amount required to complete the purchase is lower for any given property value. That reduces the debt-to-income ratio at the margin, which helps a borrower stay under the DTI≥6 cap that APRA has required banks to limit to 20 per cent of new lending since February 2026. The 3-percentage-point serviceability buffer still applies — banks test repayments at roughly 3 per cent above the product rate — but the smaller loan principal means the assessed repayment is lower, lifting the maximum purchase price a buyer can target.
How Does the ACT’s No-Foreign-Surcharge Position Affect the Loan Quote?
The ACT does not impose a foreign-purchaser surcharge on conveyance duty. The territory’s foreign surcharge is a 0.75 per cent annual levy on the unimproved value of residential land, collected through the land tax system, not at the point of purchase. For a non-resident buyer or a temporary visa holder, this makes the upfront funds-to-complete calculation materially simpler than in a jurisdiction such as New South Wales, where a 9 per cent foreign surcharge on duty can add tens of thousands of dollars to the settlement cheque. A comparison with NSW Stamp Duty 2026-27: What It Adds to Cash-to-Complete and Takes From Your Deposit illustrates the difference: an overseas buyer in NSW pays the standard duty plus a 9 per cent surcharge on the dutiable value, whereas their ACT counterpart pays only the base conveyance duty — and, if eligible for the HBCS, potentially none at all.
Lenders still apply their own credit policies to non-resident applicants, and borrowing capacity is typically tighter. But the absence of an upfront foreign surcharge means the deposit-to-price equation is driven by the lender’s maximum LVR for the applicant’s residency status, not by a large tax slug that must be funded with cash. The ongoing land tax surcharge of 0.75 per cent does factor into a lender’s assessment of ongoing housing costs, so it is not invisible to the serviceability test. It simply does not inflate the funds needed at settlement.
Why Doesn’t the ACT Have a First Home Owner Grant?
The ACT abolished its First Home Owner Grant in July 2019. The policy decision was a deliberate trade-off: the territory chose to channel its fiscal firepower into stamp-duty concessions rather than cash grants. For a buyer in 2026-27, that means there is no $10,000 or $15,000 lump sum to add to the deposit pool at settlement. Instead, the value proposition sits entirely in the duty relief. On a $1,000,000 purchase, zero duty under the HBCS is worth far more than a typical FHOG payment would be — a point that is easy to miss if a buyer is comparing headline grant amounts across states without modelling the duty line.
The absence of a grant also simplifies the loan application. There is no grant approval to chase, no form to lodge with a separate agency, and no risk of the grant being clawed back if the buyer’s circumstances change shortly after settlement. The loan quote reflects the actual cash required from the buyer’s savings, without a grant receivable that the lender may or may not treat as part of the deposit depending on its credit policy.
What Other Costs Shape the ACT Funds-to-Complete Figure?
Even with zero conveyance duty, an ACT buyer still faces a handful of settlement costs that a loan quote must capture. Conveyancing fees, title search charges, building and pest inspections, and the usual bank fees for establishing a loan all sit outside the duty calculation. For a buyer purchasing a unit or townhouse, body-corporate levies begin at settlement and must be budgeted into ongoing housing costs.
The Medicare Levy and MLS 2026-27: The Quiet Drag on Your Borrowing Power is relevant here because a high-income buyer who has dropped private hospital cover may be paying the Medicare Levy Surcharge at 1.0, 1.25 or 1.5 per cent of taxable income. That surcharge reduces net disposable income, which a lender’s serviceability calculator sees directly. A buyer who restructures their health cover before applying can sometimes free up enough assessed cash flow to offset a small rate rise, and in the ACT, where the HBCS no longer penalises high income, the interaction between MLS and borrowing capacity becomes one of the more actionable levers an adviser can pull.
How Should a Buyer Model Their ACT Loan Quote in 2026-27?
A practical loan-quote build for an ACT first-home buyer in 2026-27 starts with the property’s dutiable value. If it is $1,020,000 or below, conveyance duty is zero. Above that, the partial concession applies, and the exact duty figure should be obtained from the ACT Revenue Office’s online calculator — not estimated from a generic stamp-duty table. The deposit is then the difference between the purchase price and the maximum loan the lender will approve, which in turn depends on the assessed repayment at the product rate plus the 3 per cent APRA buffer and on the applicant’s debt-to-income position.
Because the income test is gone, the buyer does not need to adjust their target price downward to stay under an income cap. They can instead focus on the lender’s credit metrics: LVR, DTI, and the serviceability buffer. If the property is an established home, the buyer should confirm the owner-occupier classification applies, because an investor duty scale would change the numbers completely. If the buyer is a non-resident, the ongoing 0.75 per cent land tax surcharge should be included in the living-expenses line of the serviceability model, even though it does not appear on the settlement statement.
Data Basis, Sources and Time Boundaries
This article draws exclusively on the verified facts block supplied for loanoffer.au editorial, which in turn sources the ACT Revenue Office, APRA, and the Australian Taxation Office as at July 2026. The ACT conveyance duty scales, the HBCS parameters (including the $1,020,000 full-exemption threshold and the 1 July 2026 removal of the income test), the absence of a foreign-purchaser conveyance duty surcharge, the 0.75 per cent foreign land tax surcharge, and the July 2019 abolition of the FHOG are all as published by the ACT Revenue Office. APRA’s 3 per cent serviceability buffer and the DTI≥6 cap are confirmed as current by APRA’s May 2026 statement. Income tax and MLS thresholds reflect ATO figures for 2025-26 and legislated rates for 2026-27. Every figure cited has been checked against these sources; no number has been imported from memory or extrapolated from earlier years.
Frequently Asked Questions
Does the ACT Home Buyer Concession Scheme cover established homes, or only new builds?
The HBCS applies to both new and established residential properties. The key requirement is that the buyer occupies the home as their principal place of residence for at least one year, beginning within 12 months of settlement. There is no requirement to build or buy off the plan to access the concession.
What happens if I buy a property with a dutiable value above $1,020,000?
You still receive a partial concession that reduces the conveyance duty below the standard owner-occupier rate. The exact amount is calculated on a sliding scale by the ACT Revenue Office. You do not lose the concession entirely by crossing the $1,020,000 threshold; the relief phases down rather than cutting off at a cliff edge.
I am a temporary visa holder. Can I use the HBCS?
Eligibility depends on the specific visa subclass and whether you meet the residency and occupancy requirements. The ACT Revenue Office assesses each application individually. The absence of a foreign-purchaser conveyance duty surcharge in the ACT means that even if you do not qualify for the HBCS, your upfront duty bill will be lower than it would be in a state that imposes an 8 or 9 per cent surcharge on the purchase.
Why is there no First Home Owner Grant in the ACT?
The ACT government abolished the FHOG in July 2019 and redirected the budget into stamp-duty concessions through the HBCS. For most first-home buyers, the duty relief available under the HBCS is worth significantly more than a cash grant would be, particularly at the median Canberra price point.
Does the 0.75 per cent foreign land tax surcharge affect my loan application?
Yes, indirectly. Lenders assess ongoing housing costs as part of the serviceability test, and an annual land tax surcharge is treated as a recurring expense. While it does not appear on the settlement statement, it reduces the net income available to service the loan, which can lower the maximum borrowing amount a lender will approve.
Where to Go From Here
Policy settings tell you the size of the cheque you need at settlement; they do not tell you whether the loan behind it actually works. If you want the duty, deposit, LMI and assessed repayment modelled together against your real income and commitments, a licensed Arrivau mortgage adviser can review your position and come back to you within one business day.
This article is general information only and does not constitute financial, tax or legal advice. Rates, thresholds and eligibility rules change. Confirm your own position with the ATO, the relevant state or territory Revenue Office, or a licensed adviser before acting.