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Land Tax - A Tax You Can Plan To Avoid!

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Your Investment Property | 08 Aug 2012, 12:00 AM Agree 0
There are essentially three steps that can be taken to minimize land tax. You will need to evaluate your own circumstances and assets to decide if any of these steps would be of benefit to you.
  • simmon hisco | 29 May 2013, 05:54 PM Agree 0
    Keeping in mind that land tax is precisely that – a tax on the land value, some investors prefer to purchase units with comparatively little ‘land value’ which helps decrease their land tax payments.
  • Jack | 19 Aug 2013, 10:37 AM Agree 0
    Nice article but I don't follow the 3rd option, "Buy properties using different buying entities" how does this mitigate the land tax, I don't see any concession in the legislation due to different buying entities, Joint owners are assessed as single owners, trustee as sole owners and special trusts are "worse off". The owners would also have to "occupy" the land to claim principle place of residence and this aint going to happen across 4 properties
  • chris | 13 Sep 2013, 11:12 AM Agree 0
    i agree with jack - the 3rd option mentioned above is incorrect.
  • Paul Wilson | 17 Sep 2013, 10:19 PM Agree 0
    Thank you for your feedback.
    The safest way to identify how any land tax will relate to you is to click on the links to each of the individual State Land Tax Websites. You will see some states have a threshold and some don't. The reference to different buying entities referred to an example where an individual may be just under a threshold and if they buy their next property in a separate entity that may prevent them going over the threshold for that state. However that strategy will not work in all states. That example relates to QLD. You can read the different calculation methods for individuals and companies in QLD by visiting this link. https://www.osr.qld.gov.au/land-tax/liability-land-tax/owner-type-threshold.shtml
  • We Find Houses | 14 Nov 2013, 04:58 PM Agree 0
    Paul Wilson will be happy to answer your questions through this forum thread!
  • Trevor | 29 May 2014, 05:21 PM Agree 0
    Good article. Just want to point out that you have a couple of bad links under Appendices: TAS just loops to this same page, and ATC (sic) should be ACT - and the link is also broken. Otherwise, very useful ;-)
    FYI, I have an sophisticated planning tool that explores exactly this issue - you can create multiple scenarios of owning multiple properties under different entities, it then does the full financial analysis and compares. If you are interested, let me know...
    • Peter | 14 Jan 2015, 10:09 AM Agree 0
      Hi Trevor, would love to see the planning tool...?
  • YIP | 30 May 2014, 09:37 AM Agree 0
    Thanks Trevor. These links have been fixed now.
  • Jayne | 06 Aug 2014, 04:01 PM Agree 0
    No link to SA?
  • Jay | 04 Oct 2014, 08:10 AM Agree 0
    Can some one clarify on the land tax liability for my case? I have an independent house and a unit in NSW. My latest 2014 rates notice from my City Council shows the land value of the independent house as $263,000 and the unit land value as $39,600. I have rented out both properties. The 2014 council rate notice also says these values as Date of effect 1 July 2011. Does this mean these are the values I need to use for calculating the Land Tax for 2013-14 Tax year even though it is 2011 value? If so, do I need to pay any Land Tax as my total land value is below the NSW threshold of $412,000 (according to NSW Office of Land Revenue website).

    Appreciate your advice.

    Jay
  • Jay | 04 Oct 2014, 08:21 AM Agree 0
    Can some one clarify on the land tax liability for my case? I have an independent house and a unit in NSW. My latest 2014 rates notice from my City Council shows the land value of the independent house as $263,000 and the unit land value as $39,600. I have rented out both properties. The 2014 council rate notice also says these values as Date of effect 1 July 2011. Does this mean these are the values I need to use for calculating the Land Tax for 2013-14 Tax year even though it is 2011 value? If so, do I need to pay any Land Tax as my total land value is below the NSW threshold of $412,000 (according to NSW Office of Land Revenue website).

    Appreciate your advice.

    Jay
  • Jon | 21 Nov 2014, 10:27 PM Agree 0
    Also the land tax calculator is far from linear. Hence the need for more than one owning entity
    For example in SA, land tax on a block of land of 720k value is approx 3.5k
    But tax on 1.44M is a staggering 25k
    So splitting up the assests to more than one owner can save vast amounts
  • alexiscooper5 | 17 Jan 2015, 06:23 PM Agree 0
    Thanks a lot for the information. Yes ideally we can apply that to reduce or avoid the tax.
  • thebestyouvegot | 27 Sep 2015, 02:34 PM Agree 0
    so... not much more wiser than that described by my 15yo daughter...
  • Sue | 15 Apr 2016, 07:47 AM Agree 0
    The land tax assessed is for the calendar year I.e January-December. What happens if we sell halfway through the year and move into our PPR with no other properties? Do we have to pay the full amount? I am in Victoria.
    • Rightthefirsttime | 29 Jul 2016, 09:53 AM Agree 0
      It is calculated by the amount of months you did not reside in the property.
  • helen | 16 Apr 2016, 03:43 AM Agree 0
    RE: Buy properties using different buying entities

    Whose got the money buy 4 properties (even between 2 people). Buying one is hard enough. Anyway, I personally don't believe this is true, but even if it is, what are you going to do if they change the rules?

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