Transferring Property to a Family Member in Australia (2026)
Transferring a property to a family member — whether a child, spouse, or sibling — is a common estate planning and family wealth strategy. However, it can trigger significant tax and duty obligations, and the mortgage implications need careful management.
Why People Transfer Property to Family Members
Common reasons include:
- Estate planning: Parents wanting to pass the family home to children during their lifetime
- Debt protection: Transferring assets before entering a higher-risk business venture
- Family support: Helping a child who cannot afford to buy independently
- Relationship change: Adding a spouse after marriage
- Restructuring: Moving from personal to trust ownership (different process)
Stamp Duty on Property Transfers
In Australia, stamp duty (transfer duty) is generally payable whenever a property changes ownership — even between family members and even if no money changes hands.
The amount of duty is usually calculated based on the market value of the property (not the sale price), because the revenue offices substitute market value for under-market transfers.
Key exemptions by state (general principles only — check current state revenue rules):
| Transfer type | Stamp duty treatment |
|---|---|
| Between spouses/domestic partners | Exempt in most states (principal residence, genuine relationship) |
| Parent to child | Generally dutiable at market value in most states |
| Deceased estate transfer to beneficiary | Usually exempt or concessional |
| Transfer under family law court order | Generally exempt (Commonwealth legislation override) |
Land Transfer (Vic), Transfer Duty (NSW, QLD): Check each state revenue office for current rates and exemptions. These rules change periodically.
Capital Gains Tax (CGT) on Property Transfers
A property transfer — even a gift, or a transfer below market value — is generally a CGT event for the person transferring the property. The ATO deems the property to have been sold at market value regardless of what consideration (if any) was paid.
CGT calculation:
- Proceeds (deemed): Market value at transfer date
- Cost base: Original purchase price + capital costs
- Capital gain: Proceeds − cost base
- Discount: 50% if held >12 months
- CGT payable: The net gain added to taxable income
Main residence exemption: If the property was the transferor’s main residence throughout ownership, the main residence CGT exemption applies — no CGT is payable.
Investment property: If the property was not (or was not always) the transferor’s main residence, CGT will apply on the proportionate gain. This can be substantial for properties held long-term.
Important: There is no general CGT exemption for family transfers — even gifts are treated as market value disposals. Seek tax advice before proceeding.
The Mortgage — Who Is Responsible for the Existing Loan?
If the property has a mortgage, the lender must be involved in any transfer of title. Options:
- Repay the mortgage first, then transfer the property (cleanest but requires cash)
- Transfer and refinance — the incoming family member takes out a new loan in their own name to pay out the existing mortgage
- Lender consent to assume the existing loan — rare; lenders generally don’t allow loan assumption without full reassessment
The incoming family member (the transferee) must demonstrate their own ability to service any loan required. Lenders assess this as a new application.
Gifting vs Selling Below Market Value
A common question: should you gift the property (for $1 or nominal consideration) or sell it at a genuine price?
From a tax and duty perspective: it usually doesn’t matter. Revenue offices and the ATO substitute market value regardless. Selling at $1 to your child still generates stamp duty on market value and a CGT event on market value.
There may be other considerations:
- If the transferor has debts, a gift may be challenged by creditors as a voidable transaction
- If the transferor needs Centrelink or aged care assessment later, deprivation rules apply — assets given away may still be counted as assessable for up to 5 years
Frequently Asked Questions
Can I avoid stamp duty by gifting the property?
Generally no — state revenue offices assess duty on market value regardless of consideration. Some state exemptions apply (spouse-to-spouse, deceased estate) but gifting to children does not typically attract an exemption.
Does my child get a stepped-up cost base when they receive the property?
The incoming transferee’s cost base is the market value at the time of transfer — which becomes their starting cost base for any future CGT event when they eventually sell.
Can I transfer my investment property to my super fund?
No — you cannot transfer personal assets into an SMSF (except for certain listed securities and business real property). Residential property cannot be transferred from personal to SMSF ownership.
Related Guides
- Probate and Property Transfer — What Happens After Death
- Inheriting a Property With a Mortgage
- Joint Tenants vs Tenants in Common
- Property Ownership Structures Hub
This article provides general information about transferring property to family members in Australia. Stamp duty and CGT implications vary by state and individual circumstances. This is not legal or tax advice. Speak with a solicitor and registered tax agent before proceeding. Find advisers through MoneySmart.