Land tax is an annual state-based tax charged at the end of each calendar year with each Australian State or Territory having their own rules and thresholds. The types of properties that are covered by land tax could include residential or commercial rental properties, vacant land and holiday homes and it is mainly targeted at property investors and holiday home owners.
Often the structure in which you purchase the property will significantly affect the rate of land tax. So careful planning and advice is required before you buy your investment property to ensure you have the correct structure in place to maximise your investment returns.
In most cases, your principal place of residence will be land tax free (except in the ACT). There are often land tax penalties if you are a foreign resident and own Australian property or you rent your property on the short-term rental market – for example AirBNB or Booking.com.
You should note that Land Tax is tax deductible and it’s important you receive tax advice from Rider Accountants & Advisors, the property investment accounting specialists.
| STATE | BASE % | SURCHARGE | INDIVIDUAL THRESHHOLD | COMPANY THRESHOLD | FAMILY TRUST THRESHHOLD | UNIT TRUST THRESHHOLD |
| ACT | $1693 +1.25% | 0.75% foreign | $0 | $0 | $0 | $0 |
| NT | NIL | NIL | NIL | NIL | NIL | NIL |
| NSW | 1.6% – 2% | 4% foreign | $1,075,000 | $1,075,000 | $0 | $1,075,000 |
| QLD | 2.75% | 2% foreign/ absent | $600,000 | $350,000 | $350,000 | $350,000 |
| SA | 2.4% | 2.4% blind trusts | $833,000 | $833,000 | $25,000 | $25,000 |
| TAS | 1.5% | 2% foreign | $125,000 | $125,000 | $125,000 | $125,000 |
| VIC | 2.55% | 4% absent 1% vacant 7.5% Airbnb | $50,000 | $0 | $25,000 | $25,000 |
| WA | 2.67% | 0 | $300,000 | $0 | $0 | $0 |