Land Tax – The Basics You Need To Know

land tax

It’s Land Tax Time Again

Property owners will have either received your Land Tax notice or it’s in the mail to you.

We have received our Land Tax notice, the first payment is due on 11 March followed by another on 10 April and the final installment on 12 May.

Are Investment Properties Liable for Land Tax?

The house that you live in (your principal place of residence) is usually exempt from Land Tax. Investment properties are generally subject to Land Tax.

The Land Tax threshold this year is $412,000. This means if the combined value of your investment properties is above the threshold you may be liable for Land Tax. More than likely if you own a house which is rented you will be liable for Land Tax.

Consult your Accountant for advice about your specific circumstances.

Who values your land for Land Tax purposes?

The Valuer General is an independent officer appointed by the Governor of NSW to oversee the valuation system.

The Valuer General is responsible for providing fair and consistent land values for rating and taxing purposes.

How is your land valued for Land Tax?

Property sales are the most important factor considered when determining land values.

Most land is valued using the mass valuation approach where properties are valued in groups called components. The properties in each component are similar or are expected to reflect changes in value in a similar way.

Representative properties in each component are individually valued as at 1 July each year to determine how much the land value has changed from the previous year. During the valuation process, valuers analyse sales of both vacant land and improved properties, making adjustments for the added value of improvements.

What factors are considered when valuing land for Land Tax?

  • property market conditions as at 1 July in the year of the valuation
  • most valuable use for the land
  • location of the land
  • constraints on use such as zoning and heritage restrictions
  • land size, shape and land features such as slope etc
  • views
  • nearby development and infrastructure.

(This information was provided in the fact sheet accompanying our Land Tax assessment).

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