Taxation is a complex area. It’s such a broad topic that, sometimes, understanding it can be intimidating, not to mention time-consuming. But as taxpayers, it is our responsibility to know the taxes that we need to pay.
Land tax refers to tax that is levied on landowners on December 31 every year.
For instance, if you’re a land owner, there’s land tax that you need to be aware of. And it varies depending on the state or territory. In this article, let’s focus on land tax and exemptions in New South Wales.
Land tax refers to tax that is levied on landowners on December 31 every year. It is applicable to all land, whether income is generated from it or not. This includes vacant land, land with a house or residential unit, holiday homes, company title units, residential, commercial or industrial units, commercial properties such as shops and warehouses, as well as land that is leased from the State or Local government.
Land tax should be paid by any owner of one or more parcels of land. When it comes to determining land value, the Valuer General in New South Wales values all land every year and provides a value for taxation purposes.
When it comes to land tax exemptions in New South Wales, there are several things to consider:
Principal place of residence
You can claim a land tax exemption for land that serves as your principal place of residence. The value or size of the land does not have an impact on this exemption. Bear in mind that a family can only claim the exemption of principal place of residence for one property.
Principal place of residence concessions for mixed-use properties
If the land serves as both your principal place of residence and area where you operate your business, you may have eligibility for a land tax reduction for the part of the land that is used as your principal place of residence. Only the part of the land that is used for business activities will be up for land tax.
Land tax exemption may be applied to land that is used and occupied mainly for boarding houses, as long as these meet the guidelines of the Treasurer.
If you’re an owner of a residential park that is mainly used and occupied by retirees, you may be eligible for a partial or full land tax exemption.
Do you have other ideas about land tax exemptions in New South Wales and land tax in Australia? Share your insights in the comments section.