SA land tax south australia

Discussion in 'Property Management' started by pully, 18th Nov, 2018.

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  1. pully

    pully Well-Known Member

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    We pay land tax in south Australia.
    The latest bill suggests our home, occupied and exemption approved by Revenue SA in 2012, has now been included in the total land tax assessment.
    We have not seen any change in legislation about including the PPR and will be seeking an amendment or explanation.
    Has anyone else had this experience? it has increased our land tax bill considerably.
     
  2. Scott No Mates

    Scott No Mates Well-Known Member

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    NSW includes the ppor in the value of land owned but it is also deducted out as exempt.
     
  3. Scott No Mates

    Scott No Mates Well-Known Member

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  4. D.T.

    D.T. Specialist Property Manager Business Member

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    Please firstly ensure you're not confusing it with the Emergency Services Levy, as this comes from the same department (RevenueSA) and this one does include your home in the sums.

    There has been some changes to Land Tax this year :
    1) Amalgamation of entities, eg if you own property in own name and in trusts, its all calculated together now instead of separate tax free thresholds.
    2) The tax free threshold has been increased (ie own more before you start paying) and the rate of cents per dollar has been reduced.

    These 2 items combined, make it cheaper to hold onto for those who have just a couple of properties and more expensive for those with more substantial portfolios.

    You can still have exemption on own home. I dont believe there's been any changes with regards to this.
     
  5. Paul@PAS

    Paul@PAS Tax, Accounting + SMSF + All things Property Tax Business Plus Member

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    The main residence isnt added to taxable land for the occupants. However the ownership of the family home could impact a owner who is not occupying the main residence so that it complies with 100% exemption. The final form of the bill may or may not retain this contentious element (in full). The Commissioner of Revenue needs to issue a ruling on the PPOR exemption and its application to the new law.

    eg Dad helps his daughter buy her home and owns 50%. He also has other property investments in his name, jointly with his wife and in a company and a trust. Dad is now likely to be taxed on his (50%) share of his daughters residence I believe as well as all the other entities so only one threshold is given. In the past Dads and his daughters interest in the property would have been a individual owner with a distinct threshold.

    Those who reside in their own property would be exempt.

    The most practical way to address this new rule is for secondary assessments to occur. Eg the company will pay land tax. Then this will be grouped and a share of the tax paid by the entity given so that incremental tax is paid. The NSW system presently works this way with unit trusts for example. A UT gets a full threshold. But if the unit holder is a disc trust it gets clawed back so the threshold value becomes taxed.
     
    Last edited: 2nd Dec, 2019