What is Land Tax?
From 01 July 2018 all of the properties in the ACT that are not the primary places of residence, or are in a specific exemption category, are subject to land tax. The ACT Government collects the land tax in order to fund a range of Government services and infrastructure projects such as the light rail, revitalisation of Civic and other initiatives.
So who pays this tax? Land tax is payable by the owners or any block of land that is not used as a primary place of residence. Prior to 01 July 2018 this was applicable to investment properties only, however it is now applicable to all properties including those that are vacant or unoccupied. The definition of the owner includes physical persons as well as corporations and trusts
How much and how often?
Unlike the property purchase stamp duty, which is a one off payment that the Government collects from the new property owner upon settlement, land tax is an ongoing expense for the property owners. The amount of tax payable is worked out by the ACT Revenue Office every quarter but includes two basic components; a fixed charge of $1,203 plus a valuation component. The ACT Government calculator allows anyone to estimate their potential tax liability.
Tax liability is assessed every quarter as at the following dates: 01 January, 01 April, 01 July and 01 October.
It is important to note that owners have only 30 days to notify the ACT Revenue Office once the property becomes liable for land tax. Failure to notify the Office in time may incur penalties and interest.