How CGT applies in NSW
There is no NSW capital gains tax. When you sell an investment property in NSW you calculate CGT exactly as anywhere else: capital proceeds minus cost base, less losses and the 50% discount, taxed at your marginal rate in your federal tax return for the year of the sale contract. Use our property CGT calculator.
NSW transfer duty (stamp duty)
The transfer duty you paid to Revenue NSW when you bought is part of your cost base, so it reduces your gain. Use the amount shown on your settlement statement – NSW duty thresholds are indexed each 1 July, so today’s rates won’t match what you paid years ago. If you need to recalculate, use Revenue NSW’s duty calculator.
NSW land tax
Land tax on a rental property is deductible against rental income each year, so it isn’t part of the cost base. For land that never produced income (e.g. a vacant block held for later), non-deductible land tax can be included as a holding cost.
NSW worked example
A Sydney unit bought in April 2016 for $950,000 with $38,240 transfer duty (the NSW general rate at the time) and $2,000 legal fees, sold in May 2026 for $1,480,000 with $28,000 selling costs. Owner’s other income: $120,000.
- Cost base $1,018,240 → capital gain $461,760
- Net capital gain after the 50% discount: $230,880
- Estimated tax: $101,864
- Including the stamp duty in the cost base saves about $8,986 in tax.
Foreign purchasers and sellers
Surcharge purchaser duty paid by foreign buyers (currently 9% of the dutiable value, up from 8% on 1 January 2025) is also part of the cost base. Foreign resident sellers can’t claim the main residence exemption unless the life events test applies, and any seller without an ATO clearance certificate has 15% withheld at settlement. Foreign resident CGT.
Frequently asked questions
Is there a separate capital gains tax in NSW?
No. CGT is a federal tax administered by the ATO and the rules are identical in every state and territory. State taxes such as stamp duty and land tax only affect your CGT through the cost base.
Is stamp duty part of the cost base?
Yes. Transfer duty paid on buying the property (including any foreign purchaser surcharge duty) is an incidental cost of acquisition and is included in the cost base, reducing your capital gain.
Can I include land tax in the cost base?
Only if it wasn’t deductible. For a rental property, land tax is a deduction each year and is not added to the cost base. For vacant land or a holiday home not rented, non-deductible land tax may form part of the third element for assets acquired after 20 August 1991.
References
Every figure on this page was checked against these primary sources on 16 October 2026.
General information only – not financial or tax advice. See our disclaimer. Spotted an error? Email hello@cgtcalculatoraustralia.com.