Queensland Land Tax Changes & How This Impacts You

Contents

• What is Land Tax?
• How Land Tax In QLD Was Calculated – Prior To The Change
• How Land Tax In QLD Will Be Calculated – What is the Change?
• If This Change Impacts You, What Next!?
• Frequently Asked Questions

What is Land Tax?

As Gabrielle Bow mentioned in her Land Tax article last week, the excess value of unimproved land that is above the land tax threshold is subject to an annual Land Tax. Note that each state and territory has it’s own threshold, exemptions and regulations.

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How Land Tax In QLD Was Calculated – Prior To The Change

Land Tax in Queensland is triggered at midnight on 30 June each year. Any person or entity who owns land in Queensland calculates their Queensland Land Tax liability based solely on their Queensland Landholdings. The unimproved value of the land held in Queensland only (allowing for any exemptions) is then utilised to determine if you have exceeded the land tax threshold for that particular year.

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How Land Tax In QLD Will Be Calculated – What is the Change?

If you or an entity solely own land in Queensland, this change is not applicable to you and you will not be affected.

You will be impacted however, if you own land in Queensland and in other states & territories.

The Change: As of 30 June 2023, the Queensland Government will utilise the total value of your Australian-Wide Land holdings, to determine if you have exceeded the land tax threshold in Queensland for that particular year.

As you may have surmised, this could result in a significant increase in your Queensland Land Tax Liability, if you hold land in several states in addition to Queensland.

The following example sourced from the Queensland Government demonstrates how significant of an impact this change could be for you;

Example

Lena owns land in Queensland with a taxable value of $745,000, along with land in Victoria with a value of $1,565,000.

Under the current methodology for calculating land tax, Lena’s land tax liability in Queensland would be $1,950 for the 2022-2023 year.

Presuming the value of the land and the land tax rates for Queensland haven’t changed, Lena’s liability for the following year (in which your total Australia-Wide land holdings are taken into consideration), would be $8,422.

As a result of the changes, Lena is liable for an additional $6,472 of Land Tax.

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If This Change Impacts You, What Next!?

If you own land in Queensland and in another state or territory, you will need to establish a Queensland Revenue Office online account (if not already), to declare all of your national land holdings (including value & percentage of ownership).

From 30 June 2023, the declaration will need to be completed by whichever of the following deadlines comes first:

• 30 Days of receiving a land tax assessment notice
• On or before 31 October

Please note the obligation to declare interstate land-holdings falls on the landholder.

If you are unsure whether or not this change impacts you, please feel free to reach out to the team at BLG Business Advisers.

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Frequently Asked Questions

Does this mean Queensland is collecting land tax on behalf of other states and territories?

No – The value of land held in other states simply goes into the calculation of determining your land tax liability in Queensland.

Will Other States & Territories Adopt The Same Methodology?

Generally speaking, majority of states & territories were (until the Queensland Governments recent announcement) in-sync with the methodology of determining whether you have exceeded the land-tax threshold.

While no other state or territory has currently announced it’s intention to follow Queensland’s lead with regard to the new methodology of calculating land tax, it shouldn’t be ruled out that other states may adopt this change in due course.

Do I Have Any Restructuring Options To Minimise My Exposure?

Yes you do! BLG’s team of advisors can assist with reviewing your situation and determining if re-structuring to minimise your exposure is the most appropriate course of action.

Our team at BLG Business Advisers assists property investors in all states of Australia. Please talk with us to discuss your property or land tax situation and go through the process.

Wishing you every success!

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*This information is correct at the time of publishing and is subject to change.*