TAX TIP #39: | QLD LAND TAX | INTERSTATE PROPERTIES | POTENTIAL AUSTRALIA-WIDE HARMONISATION

This post is no longer up to date. Please refer to Tax Tip #43 for more information.

Alert

From 30 June 2023, Queensland land holders will be subject to land tax calculated on the total value of Australian land which includes relevant interstate land but not excluded interstate land e.g. principal place of residence.

Land tax appears to be the ‘new’ but old focus for State revenue.

Potential flow-on to other States

If we look to the past, in 2007, the State Revenue Commissioners across all Australian states and territories discussed harmonised payroll tax administration. This was implemented in 2009.

This has potential to go the same way as payroll tax harmonisation.

Key Impacts

• the rate of land tax that will be applied to the Queensland proportion of the landholdings

• whether the tax-free threshold has been exceeded (note, Qld has a sliding scale for land tax, that is, not a single percentage)

Example - how the land tax is calculated

Landowner L owns land with the following land tax values:

• $745,000 – Qld

• $1.565M – NSW

• $2.31M - Total

The ‘notional’ land tax is calculated on $2.31M, being $26,115.

The ‘Qld component’ is apportioned through land tax value, being $0.745M divide by $2.31M multiplied by $26,115.

As a consequence of the change, Landowner L’s land tax will be $8,422.37.

To put this into context, prior to the change, Landowner L’s land tax was $1,950.

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