Land Tax State By State Territory By Territory 2019

Hey all,

I scoured the internet for this information and couldn’t find it all in one place thus I decided to do it myself.

This is a land tax table for individuals as at 14/03/2019 and without taking into account any exemptions/additions.

I put the figures in $ per week as that way it was easy to relate back to the rent on your portfolio.

I hope someone finds this useful.

CLICK THE IMAGES TO SEE THEM FULL SIZE




One might be forgiven for thinking that for example TAS would be a bad place to grow a portfolio over VIC in using these numbers, but I encourage one to think of it this way:

Land tax is typically based off land/site value in Australia which isn’t the same as market value. It is often far less than market value.


Thus follow this analysis, imagine a really simplistic example where you had the choice of a $4 million portfolio in VIC representing $3 million in land value, over a similar sized portfolio in TAS.

The numbers would say VIC is a better choice from a land tax perspective with a $16,000 saving, but…

If you focus entirely on Melbourne houses then a reasonable yield (rental return) may be 4%, whereas in TAS a reasonable Hobart house yield may be 5.5%.

4% of $4 million is $160,000 rent per annum, whereas in Hobart 5.5% of $4 million is $220,000=that is a difference of over $60,000 per year far outweighing the yearly land tax difference.


And we haven’t even discussed the stamp duty differences between the states, let alone expense differences of assets...

Nonetheless I do still think the following table is useful and am not surprised that some of the states with the worst affordability happen to have some of the most relaxed land taxes. I get it that these states have higher asset prices but still the percentages at $3,000,000 or even getting close to that...

Note on the whole WA Metro versus Non-Metro, I can't find a map of it but basically it is special levy on the area of Metro Perth.

Cheers.

 

Could you add in to the tables the thresholds at which land tax becomes payable, and actual % rates?

 

I might try, but it isn't that simple as they don't do their measurements all the same way. For example some have flat percentage whereas others have a fixed portion and then percentages. I'll see how I go.

 

Also, one thing to remember $3,000,000 of property in Adelaide would be a lot more property than you'd get for the same $ value in Sydney or Melbourne.

 

Here is the rates breakdown:
CLICK THE IMAGES TO SEE THEM FULL SIZE




By my maths on the highest threshold (i.e. an $11,000,001 portfolio), the worst state is South Australia by quite a long way. The best at said threshold, bar the NT which has no land tax, ironically is the ACT.

Meaning no disrespect but @D.T. how do your owners deal with this?

 

Land tax thresholds are very important to each owner type as most land owners will use some or all of their threshold and pay no tax or far less tax than is implied by the scales. The tax free value and the land value in each state are relevant to the final cost per week for rent. Its highly misleading and incorrect to assume that land tax rates apply to every dollar of unimproved land value.

Also some entities / owners have a different threshold. (eg NSW and non-fixed trusts or many states for trusts)

Land tax surcharges may also be relevant

Land tax is based on the unimproved land value however some states (eg NSW) modify the land
tax scales, rates or thresholds. For example in NSW the average of three years values is used as the taxable value which has a threshold applied. The threshold is indexed annually unlike Vic where is have been capped for a long time. A scaled in tax rate applies to Vic which imposes a far higher % of tax to incremental land value and is non-linear.

 

I recently crunched some land tax numbers for individuals in QLD, NSW, VIC & SA. I made a chart based on my calcs and find it very interesting to view the data this way.

Please verify before using this information for any decision making. There are many caveats and limitations to this snapshot of data but I find it a good starting point

 

If you are paying land tax you have first world problems...

 

My land tax bill this year was a touch under $18,000. I consider it one of the costs of doing business...ie holding a large portfolio worth 8 digits

But I would agree that in some states the threshold is way too low.

 

Im in SA, does anyone know if the land tax of your ppor is included in the land tax estimate? E.G. ppor+ip1 is >369 tax free threshold and you pay or you just count the IP's?

 

PPOR's are exempt in every state as far as I know...

 

Tell me about if...I at over 12k per annum in Qld...I don't mind paying it but the growth is not as good.

My portfolio in VIC is more then double the size but only pay 6k.....go figure...

 

I’ve just received my first land tax bill for VIC. There’s an option to pay it all now or pay over 4 instalments at the same cost.

What’s the catch here?

Is there any disadvantage paying this in instalments?

 

watch the deductibility issues. if you go into next financial year the land tax won't be deductible.

See
Land tax can only be claimed in the year in which it relates to - not the year in which it was paid. ATO ID 2010/192 (now withdrawn, but law still current).
Tax Tip 8: Forgotten land Tax

 

Commonwealth and State legislation doesn't 'match up'