Land Tax is calculated on the Unimproved Value of freehold land, not the total property value.   It is assessed by the Valuer General each year and used for land tax and for council rates.   No Return is required from the property owner, an Assessment is issued on the basis of land in the Titles Office.

It is calculated on property owned in Queensland on 30 June each year.   If the value exceeds the Threshold, tax is payable.   Excluded from land tax is a principal residence (unless rented out) and farming properties.   You need to claim an exemption in the first year and then it continues.

Each State taxes differently, and this article only deals with Queensland.

Please call if you would like information on another State.

The Thresholds depend on the categories applicable: Residents, absentees, companies, trustees (including deceased estates).

Individuals

         $0 - $599,999                                       $0

         $600,000 - 999,999                              $500 + 1% for each $ above $600,000

         $1,000,000 - 2,999,999                        $4,500 + 1.65% for each $ above $1m

         $3,000,000 - 4,999,999                        $37,500 + 1.25% for each $ above $3m

         $5,000,000 & over                                $62,500 + 1.75% for each $ above $5m.

Trusts, Companies (& SMSF's)

         $0 - $349,999                                       $0

         $350,000 - 2,249,999                           $1,450 + 1.7% for each $ above $350,000

         $2,250,000 - 4,999,999                        $33,750 + 1.5% for each $ above $2,250,000

         $5,000,000 & over                                $75,000 + 2.0% for each $ above $5,000,000

Land Tax Planning

The best time to get advice is before a contract is signed.   Generally, if a property is negatively geared it should be held by the person paying the highest income tax rate because the income tax saved should exceed the land tax paid.   If positively geared it should be in the hands of the person paying the lowest tax rate.

As Land Tax is a State tax, there is no carry over to another State so the Threshold starts again in the next State.