Who Pays Land Tax in Australia and How Much Is It?

Who pays land tax?

You may have to pay land tax if you own, or jointly own:

• vacant land, including rural land
• land where a house, residential unit or flat has been built
• a holiday home
• an investment property or properties
• company title units
• residential, commercial or industrial units, including car spaces
• commercial properties, including factories, shops and warehouses
• land leased from state or local government.

Land tax applies regardless of whether income is earned from the land.

Generally, you do not pay land tax on:

• your home, known as your principal place of residence
• your farm, known as primary production land
• any land you own with total taxable value below the land tax threshold.

You must register for land tax if the value of all your taxable land is above the threshold, even if you have not received a notice of assessment.

How land tax is calculated

Land tax is calculated on the total value of all your taxable land above the threshold, not on each individual property. If the combined value of your land does not exceed the threshold, no land tax is payable. Your liability for each year is based on the value of all land you owned on 31 December in the previous year. Any changes to the land you own this year will only affect how much you pay in the following year.

The thresholds for land values change each year and are applied as follows:

• General threshold: $100 plus 1.6% of land value above the threshold, up to the premium threshold.
• Premium threshold: $67,364 plus 2% of land value above the threshold.
• The threshold is published in the Government Gazette in October each year and is applied to land holdings on 31 December each year.
• Land tax is applied for the full year following the taxing date of 31 December, and no pro-rata calculation applies.