WHO SHOULD PAY LAND TAX?
If you own property, you may have to pay land tax. If your home is the only property you own you will not pay land tax because your home is exempt.
You pay land tax if the total taxable value of all the Victorian land you own, individually or jointly, as at 31 December, is equal to or exceeds $250,000 ($25,000 for trusts). For each year you own land in Victoria with a total taxable value equal to or above the relevant threshold, you must pay land tax.
If you have received a land tax assessment for the first time, it could be because:
- You became the owner of taxable land, such as an investment property or holiday home.
- The total taxable (site) value of all your taxable land increased to meet or exceed the $250,000 threshold ($25,000 threshold for trusts).
- Land previously exempt from land tax is no longer exempt.
How is the taxable value of land calculated?
Your 2019 land tax assessment is calculated using site valuations prepared by councils in 2018.
Disagreeing with your site value
While we use site valuations for land tax purposes, we are not involved in preparing them. If you disagree with the site value on your assessment you can object to it.
Objecting to the values set out on your land tax assessment, which we issue, is a different process to objecting to those on your council rate notice.
The site value of all the taxable property you owned at midnight on 31 December 2018 has determined whether you receive an assessment notice in 2019.
It means the total taxable value of all the Victorian property you owned as at that date, excluding exempt land such as your home, was equal to or exceeded the threshold of $250,000 ($25,000 for trusts).
The rate of land tax you pay depends on the total taxable value of all the Victorian property you own.
Land tax applies to all types of land, including residential and commercial properties, apartments and vacant land. If the residential property you own is not your home and the site value of the apartment meets or exceeds the threshold, either on its own or when added to the taxable value of the other properties you own, you will have to pay land tax.
Property bought, sold or settled
We do not adjust land tax assessments for property bought, sold or settled during an assessment year. Generally, your solicitor or conveyancer can advise you about any land tax adjustments that may need to be made when you buy or sell a property.
Answers to frequently asked questions
What is land tax?
It is an annual tax based on the total taxable value of all the land you own in Victoria, excluding exempt land such as your home (principal place of residence), as at midnight on 31 December preceding the year of assessment. It is different to vacant residential land tax.
When the total taxable value of the non-exempt land you own is equal to or above the $250,000 threshold ($25,000 for trusts) you must pay land tax.
Do I have to pay land tax on my home?
No. Your home (principal place of residence) is exempt from land tax. If this is the only property you own and you have received a land tax assessment, please call us on 13 21 61.
Why have I received an assessment for the first time?
You have received an assessment because our records show that the total taxable value of all the Victorian property you owned, excluding exempt property such as your home, on 31 December 2018 has met or exceeded the $250,000 land tax threshold ($25,000 for trusts).
This may have happened because:
- You have purchased non-exempt land in the past calendar year, such as an investment property or holiday home.
- An exemption has been removed. For example, you may have started renting out what used to be your principal place of residence.
- The value of your non-exempt land has increased to be equal to or above the threshold.
How is land tax calculated?
It is calculated by applying the appropriate land tax rate to the total taxable value, or site value, of your land holdings. This taxable value does not include exempt land such as your home.
We do not prepare site valuations as these are prepared as part of the general valuation process, which is also used by local councils to calculate rates.
What is the assessment period?
Land tax is assessed on a calendar year basis on the land you own at midnight on 31 December before your assessment is issued. For example, the land you own at midnight on 31 December 2018 is used to calculate land tax in 2019.
How can I pay my land tax bill?
You can pay your land tax by credit card, BPAY View, at a Westpac Branch or by Autopay Instalments if it is listed as a payment method on your assessment notice. You can pay your assessment in a lump sum or quarterly.
What if the land is held by a trust?
Land held on trust is treated differently from land owned by someone in their own right or jointly with others.
If you own land as a trustee of a trust for a beneficiary, you have to pay land tax if the total taxable value of the Victorian land holdings meets or exceeds the $25,000 trust threshold.
A surcharge rate applies if the total taxable value of the Victorian land holdings is $25,000 through to less than $3 million, with no surcharge rate applying for those valued at $3 million or more.
The trust surcharge rule is subject to various exclusions and exceptions, for example:
- It does not apply to certain trusts, such as an administration trust.
- Trustees may avoid the surcharge rate by notifying us of the beneficial interests in land or unitholders of the trust.
I have received two assessments – is this right?
You may receive more than one assessment because it depends on how you own land and who you own it with. There are three types of assessments:
- Individual assessments – you should only receive one individual assessment.
- Joint assessments – if you own land jointly with others you may also receive a separate joint assessment. Each unique combination of owners is considered a different joint ownership, so you may receive more than one joint assessment if you are a member of a number of unique joint ownerships. The person receiving the joint assessment is receiving it on behalf of the other joint owners.
- Trust assessments – if you own land as the trustee of a trust, you may receive a separate trust assessment for each trust for which you are trustee.
© State of Victoria (State Revenue Office).