Did you get a land tax bill for the first time?

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Land held in Victoria that does not qualify for exemptions (such as your principal place of residence) will generally be subject to Land Tax. This includes properties like holiday homes, commercial properties and vacant land.

You may have received an assessment for Land Tax from the State Revenue Office (SRO) of Victoria for the first time recently despite owning a property for a long time, generally assessments are issued between January and June each year.

The reason more Land Tax Assessment Notices are getting sent to Victorian property owners is because the SRO property site value threshold recently dropped significantly; from $300,000 to just $50,000.

This new threshold does not include properties held within trusts, Land Tax for these are calculated differently.

This means that properties subject to land tax valued above just $50,000 and not held in a trust will now incur a land tax liability.

For some owners, this means that 2024 is the first time their property has been captured. Changes applied for the calendar year beginning 1 January 2024 and valuations are based on the land (site) value at 31 December 2023.

Both the threshold and the rate of land tax has increased.

For example, a property with a site value of $500,000 in 2023 would likely have had a land tax liability of approximately
$375 + $400 = $775

Now, the same property in 2024 with a site value of $500,000 would likely have a land tax liability of approximately
$1,350 + $600 = $1,950

The SRO netting an additional $1,175 in land tax for the same property.

Residential properties left vacant for a period of time, generally 6 months or greater, may also be subject to additional surcharges. There are special provisions for holiday homes, where the SRO’s specified conditions are met, these homes can be exempted from the Vacant Residential Land Tax (VRLT).

Landlords should consider these additional costs that are applied to their investment properties when reviewing lease agreements.

 

As a property owner in Victoria, it is your responsibility to notify the SRO of any changes to the use or ownership of the property.
The SRO can impose penalties for failing to do so. When buying or selling, this is usually completed as part of the settlement process by your solicitor or conveyancer.

How to find out more?

The SRO provides Land Tax calculators on their website to assist with working out what your land tax assessment is likely to be.

Click to access SRO Land Tax Calculator

This is general information, for advice specific to your situation, you should contact the State Revenue Office directly on 13 21 61.