How to buy multiple IPs in the same state without getting bitten by land tax?

Sort of.

First of all the joint ownership gets a land tax registration. If its under threshold then nothing happens. However behind the scenes secondary assessment occurs. Every landowner has a individual number as well. (Most people dont know that). Secondary assessments never issue unless they result in tax.

Lets say you already own three properties and are just $1 under threshold. This new property tips you over. So a secondary assessment is issued to you that adds your share of that property.

Now you may think that's a double dip however lets assume that the joint IP is itself $1K over threshold and assessment is issued for say $100 (in theory it wont issue under the deminimis rule - I think its $50). Then your secondary assessment would issue with an apparent double tax BUT you get a 50% share of the joint land tax paid. ie $50 credit.

Don't worry about confusion. Many in tax don't understand it. The idea is that :
1. Land owners are firstly taxed on their relevant ownerships and then:
2. If a individual has accumulated land holdings and shares of credits that result in a further land tax bill a individual assessment under secondary assessment may also issue.

One of the reasons why a fixed unit trust can be clever in NSW is you can change the % ownership and there is no duty. Also its far clearer on how land tax operates.

 

Also depends waht state the property is located in.

 

Hi Terry - what are the implications for properties located in QLD?

 

Too broad a question.

Each person gets a $600k threshold in qld

 

Sorry - I meant with regard to Andrew's question - if a property is owned 50/50 in mine/my partners name, is 50% of the land value addede to each of our thresholds? Ie. could have $1.2m in land value owned 50/50 between us before we were liable for land tax?

 

Yes in QLD a couple could have a threshold of $1.2mil for one property - $600k each.

Trusts get a threshold of $300k so 2 separate trustees for 2 separate trusts could own a $600k property jointly as tenants in common and no land tax payabllle - check with your lawyer first