ACT Canberra land tax laws

Discussion in 'Where to Buy' started by Serveman, 15th Oct, 2018.

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  1. Aaron Sice

    Aaron Sice Well-Known Member

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    So its a tax on a lease, not the land?
     
  2. Scott No Mates

    Scott No Mates Well-Known Member

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    No, it's a tax on the land borne by the lessee.
     
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  3. Aaron Sice

    Aaron Sice Well-Known Member

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    Interesting.

    So the land tenure doesn't change - under a 99 year lease.

    But the lessee sublets it again, for a specific purpose, and rather than tax sublet, they tax the land.

    Sounds very Canberra to me.
     
  4. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    The lessee is treated as the owner for land tax purposes in the ACT
     
  5. Todd

    Todd Well-Known Member

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    More land tax and rates hikes in Canberra coming July 1. On my 2 bed, 2 bath 80m2 apartment in Braddon I currently pay $2,691 in land tax pa and $1,984 in rates. These will both increase by about 10% in next financial year, taking them to $2960 and $2,182. Back in 2012 my rates for the same property were $600 pa, that's an increase of about 220% in 7 years! Equating to a rise of approximately 32% per annum. Over the same period Stamp duty has been reduced and now I would pay 2.4% if I bought the apartment today, significantly less than 7 years ago. However the ACT govt overall stamp duty revenue has significantly increased during this period, due to rising hosue prices. Andrew Barr says " the heavy lifting has been done, and rates and land tax rises will be less from now on" - he is not saying they won't still rise every year for the next 5 years though. Still going up each year, just not by as much.
     
  6. Hwangers

    Hwangers Well-Known Member

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    How has your rental income increased in that timeframe?
     
  7. Todd

    Todd Well-Known Member

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    Yep rents have increased from $500/week to $575/week in this period. Tenants have in effect have shared the increased costs with me. I think rents have increased partly due to less investors in the market (as well as pop growth and a healthy ACT economy) which has a lot to do with the increased holding costs of property in the ACT.
     
  8. IsItWorthWhileToInvest

    IsItWorthWhileToInvest New Member

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    After years of struggling with the rates and land tax hikes the value is no longer there. I have two properties in Canberra and the costs coupled with government fee's are driving investors out. Its sad because the government is only driving a policy of short term gain for long term pain.
     
  9. AnDy62

    AnDy62 Active Member

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    Yet building (units) activity is still surging. I'm curious who is buying up all this stock because I agree investing in Canberra has become increasingly infeasible. Yes, rents have moved higher in response to costs, but not by enough it seems to me.
     
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  10. BuyersAgent

    BuyersAgent Well-Known Member Business Member

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    The canberra investors I know seem to be moving their investing activities to local regional NSW options (ie Queanbeyan, Wollongong, South Coast, inland to Wagga Wagga, anything within around 2-3 hrs of ACT), or interstate options such as QLD, ie gold coast etc.
     
    Toilandtrouble and Curoch like this.

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