If you own land in Western Australia, you may need to pay land tax—but only if the total unimproved value of your landholdings exceeds $300,000. This includes the combined value of all land you own, even if individual lots fall below the threshold.

Some land is exempt (e.g., your primary residence), but if your total taxable land value crosses the limit, land tax will apply.

How Land Tax is Assessed

Land tax in WA is calculated annually based on your land ownership as of midnight on 30 June each year.

Here’s how it works:

• The Valuer-General calculates the unimproved value (just the land, no buildings) of all land you own.
• Values are based on assessments from the previous financial year.
• Your landholdings are aggregated (added together), excluding exempt land like your home.
• Assessments are typically issued in November or December.

Land Tax Rates in WA (2024–2025)

Land Value	Land Tax Payable
Up to $300,000	Exempt
$300,000 – $420,000	Flat rate of $300
$420,000 – $1 million	$300 + 0.25% of amount over $420,000
$1 million – $1.8 million	$1,750 + 0.9% of amount over $1 million
$1.8 million – $5 million	$8,950 + 1.8% of amount over $1.8 million
$5 million – $11 million	$66,500 + 2% of amount over $5 million
Over $11 million	$186,550 + 2.67% of amount over $11 million

Why Is Land Tax Revenue Increasing?

Land tax collections have grown significantly due to rising property values:

• 2021–2022: $815 million (+7.24%)
• 2022–2023: $871 million (+6.87%)
• 2023–2024: $929 million (+6.66%)
• 2024–2025 (estimated): $987 million (+6.24%)

Land Tax Exemptions

Not all land is subject to land tax. You may qualify for an exemption if your property falls under one of the following categories:

• Primary residence (your home)
• Land used for primary production (farming)
• Residential land subdivided for sale
• Land built specifically for rent
• Land owned by charities, religious groups, or not-for-profits
• Aged care facilities, retirement villages, and caravan parks
• Crown land or land used for public purposes
• Mining leases or land under conservation covenants

Understanding Aggregated Land Values and Ownership Structures

Things can get complicated when land is owned in different capacities, such as personally and through a trust.

Example:
If you own land worth $500,000 as an individual and $1 million through a trust, your total aggregated value is $1.5 million.

• Tax on aggregated value: $6,250
• If assessed separately: $300 (individual) + $1,750 (trust) = $2,050

That’s a big difference—highlighting the importance of reviewing your ownership structure and possibly clarifying it with the Office of State Revenue.

What Is the Metropolitan Region Improvement Tax (MRIT)?

If your land is in Perth’s metropolitan area and is subject to land tax, you’ll also pay the Metropolitan Region Improvement Tax (MRIT).

• Rate: 0.14% of the unimproved value over $300,000
• Purpose: Funds public infrastructure and facilities in the metro region

Incorporating Land Tax into Your Investment Strategy

When planning land investments, it’s essential to factor in:

• Land tax liability (annual holding costs)
• Ownership structure (individual vs trust)
• Asset separation to reduce aggregated values
• Succession planning
• Capital gains implications

Working with a tax or property adviser can help you structure your investments to reduce tax and protect your long-term returns.

Key Takeaways

• Land tax in WA applies if your total land value exceeds $300,000 (excluding your home).
• Ownership structure matters—poor planning can lead to higher tax bills.
• Watch for aggregation rules and trust ownership complexities.
• Consider the MRIT if you own land in Perth’s metro area.
• Engage a professional to minimise land tax and align your investment strategy.

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How can we help?

If you have any questions or would like further information, please feel free to give our office on 08 9221 5522 or via email – info@camdenprofessionals.com.au  or arrange a time for a meeting so we can discuss your requirements in more detail.

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General Advice Warning

The material on this page and on this website has been prepared for general information purposes only and not as specific advice to any particular person. Any advice contained on this page and on this website is General Advice and does not take into account any person’s particular investment objectives, financial situation and particular needs.

Before making an investment decision based on this advice you should consider, with or without the assistance of a securities adviser, whether it is appropriate to your particular investment needs, objectives and financial circumstances. In addition, the examples provided on this page and on this website are for illustrative purposes only.

Although every effort has been made to verify the accuracy of the information contained on this page and on this website, Camden Professionals, its officers, representatives, employees, and agents disclaim all liability [except for any liability which by law cannot be excluded), for any error, inaccuracy in, or omission from the information contained in this website or any loss or damage suffered by any person directly or indirectly through relying on this information.

If you thought bill shock was a feature of the energy pricing industry, wait until you get your new land tax bill from the Queensland government in June 2023!

From next year, an owner’s liability for land tax will be determined based on the total value of their Australia-wide landholdings that are not exempt, rather than solely on their non-exempt Queensland landholdings.The new laws change how land tax will be assessed for individuals, companies, trustees and absentees who own land both in Queensland and interstate.

Changes to the way Queensland calculates that threshold will take in interstate holdings from 30 June 2023, meaning a taxpayer in NSW with sub-threshold land on both sides of the border could face a land tax bill for the first time. Queensland is the only jurisdiction to introduce this type of aggregation rule to include Australia-wide holdings. With inflationary pressure, interest rates on the rise, will this measure spell the end of the Queensland property investment market.

And who are the real victims? Rents will skyrocket in a market where there is already a lack of supply and investors will have to weigh up the added costs. Strap in and let’s ride this roller coaster!

1. Interstate properties and land tax

From 30 June 2023, when land tax is calculated, the total value of your Australian land will be assessed.

Relevant interstate land includes land located in another state or territory that is valued under interstate valuation legislation and is not excluded interstate land.

The total value of your Australian land will be used to determine:

• whether the tax-free threshold has been exceeded
• the rate of land tax that will be applied to the Queensland proportion of the value of your landholdings

The current tax-free thresholds are $600,000 for individuals (other than absentees) and $350,000 for companies, trustees, and absentees. You’ll only pay tax on the land you own in Queensland**

**Editors Note. The Queensland government contends that you are only paying land tax for the property you own in Queensland. Read on and make up your own mind.

2. Calculating land tax with interstate land

The land tax rate that applies depends on what type of owner you are and the value of your land. This rate (and surcharge, if applicable) is applied to the total value of your Australian land. Then this figure is applied to the Queensland portion to get the annual land tax liability.

Example – Queensland Government

On 30 June 2022, Lena owns land in Queensland with a taxable value of $745,000. Her land tax is calculated using the rates for individuals.

Taxable value of land: $745,000

Calculation
$500 + (1 cent × $145,000) + $500 + $1,450 = $1,950

We will issue an assessment notice for $1,950 for the 2022–23 financial year.

On 30 June 2023, the value of Lena’s land in Queensland has not changed. But Lena now also owns land in Victoria valued at $1,565,000. The total value of Australian land owned by Lena is $2,310,000, which means the land tax is calculated using a higher rate for individuals. This is how Lena’s land tax will be calculated:

Taxable value of Australian land: $2,310,000

Calculation Method.  $4,500 + (1.65 cents × $1,310,000) + $4,500 + $21,615 = $26,115

This amount is applied to the Queensland portion of Lena’s land (i.e. ($745,000 ÷ $2,310,000) × $26,115)).

We will issue an assessment notice for $8,422.37.

Source: https://www.qld.gov.au/

3. Setting up an online account and making a declaration.

You’ll need to set up a QRO Online account and complete the declaration, including land description, value and percentage of ownership. We will be adding more information in our next article

4. Surcharge

If you are an absentee or a foreign company or trust, a surcharge of 2% is added when calculating land tax. This applies to the total value of your Australian land.

5. Practical implications

As the full force of the changes will not be felt until 2023, it is difficult to say how this will impact on investment habits or holdings in Queensland.  We believe that Queensland provides strong potential for property investors. If you would like to discuss, property investment and tax planning, please feel free to contact me to discuss.

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General Advice Warning

The material on this page and on this website has been prepared for general information purposes only and not as specific advice to any particular person. Any advice contained on this page and on this website is General Advice and does not take into account any person’s particular investment objectives, financial situation and particular needs.

Before making an investment decision based on this advice you should consider, with or without the assistance of a securities adviser, whether it is appropriate to your particular investment needs, objectives and financial circumstances. In addition, the examples provided on this page and on this website are for illustrative purposes only.

Although every effort has been made to verify the accuracy of the information contained on this page and on this website, Camden Professionals, its officers, representatives, employees, and agents disclaim all liability [except for any liability which by law cannot be excluded), for any error, inaccuracy in, or omission from the information contained in this website or any loss or damage suffered by any person directly or indirectly through relying on this information.

Stamp Duty and Land Tax Calculator

We would like to remind all our clients with investment properties about their land tax obligations. It can be very confusing as each state varies in terms of threshold, rate applicable depending on ownership structure and the date when land tax applies.  We have summarised this all for you in a handy map for your reference.

For those with New South Wales properties the onus is on you to register and lodge your annual Land Tax Return each year. For other states State Revenue makes an assessment based on holdings at the taxing date.

There have been a number of recent changes to land tax and stamp duty in New South Wales, Victoria and Queensland in relation to foreign persons including trusts which have not specifically excluded foreign beneficiaries. If you have not already updated your trust deed to exclude foreign persons you only have until 31 December to do so.

Please reach out to your client manager if you require any assistance or have any questions relating to your land tax obligations.

Download a copy of our land tax map here.

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General Advice Warning

The material on this page and on this website has been prepared for general information purposes only and not as specific advice to any particular person. Any advice contained on this page and on this website is General Advice and does not take into account any person’s particular investment objectives, financial situation and particular needs.

Before making an investment decision based on this advice you should consider, with or without the assistance of a securities adviser, whether it is appropriate to your particular investment needs, objectives and financial circumstances. In addition, the examples provided on this page and on this website are for illustrative purposes only.

Although every effort has been made to verify the accuracy of the information contained on this page and on this website, Camden Professionals, its officers, representatives, employees, and agents disclaim all liability [except for any liability which by law cannot be excluded), for any error, inaccuracy in, or omission from the information contained in this website or any loss or damage suffered by any person directly or indirectly through relying on this information.

This renovation tip can save you thousands

Renovating an investment property is different to renovating your own home. Whether the renovation is big or small, you will be taking a head over heart approach and doing what will help you improve your return on investment.

Claiming depreciation deductions on the assets installed during a renovation usually isn’t front of mind. However, choosing assets for your renovation that hold higher depreciation deductions can boost your cash flow sooner.

What is depreciation?

Depreciation is the natural wear and tear of a property and assets over time.

Only owners of income-producing property can claim depreciation as a tax deduction each financial year. BMT Tax Depreciation consistently sees these deductions save residential investors tens of thousands.

A tax depreciation schedule completed by a specialist quantity surveyor, such as BMT, is the only way an investor can claim depreciation. The schedule lasts up to forty years and is 100 per cent tax deductible.

Depreciation and new assets

If you’re thinking about giving your investment property a facelift before advertising to prospective tenants, you may have a few things in mind. Maybe you want to give the interior a fresh lick of paint, change the outdated flooring throughout or do a full bathroom renovation. Whatever you’re planning to do, depreciation on the assets you choose should be a key consideration.

For example, floor coverings such as carpet, floating timber and vinyl are called plant and equipment assets. Each asset has an effective life and is depreciated using the diminishing value or prime cost method.

Case study: claiming more sooner following renovation

Casey owns an investment property, and she has decided to renovate it now and sell it in two years’ time.

She wants to ensure that she claims the most depreciation possible in the two years following the renovation. Her two flooring options are vinyl flooring or floating timber floorboards.

Before deciding what flooring to use she consulted a specialist quantity surveyor, to find out what’s the best option from a depreciation perspective. The specialist advised that given her short-term investment strategy, vinyl may be the better option.

This is because vinyl has a diminishing value rate of 20 per cent, while floating timber floorboard diminishing value rate of 13.33 per cent. This means Casey can claim more sooner from vinyl flooring. Furthermore, vinyl generally requires less maintenance than timber floorboards do which is ideal for an investment property.

Contact the specialist or Tax Accountant prior to your renovation

Whether you’re turning your previous home into an investment or giving your current rental a facelift, consulting a tax depreciation specialist and your accountant will help you claim the most. BMT Tax Depreciation has helped thousands of investors claim lucrative depreciation deductions following an investment property renovation.

To learn more about depreciation, visit BMT’s website or Request a Quote.

 

BMT Tax Depreciation is Australia’s leading supplier of residential and commercial tax depreciation schedules.

Bradley Beer (B. Con. Mgt, AAIQS, MRICS, AVAA) is the Chief Executive Officer of BMT Tax Depreciation.  Please contact 1300 728 726 or visit bmtqs.com.au for  Australia-wide service

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General Advice Warning

The material on this page and on this website has been prepared for general information purposes only and not as specific advice to any particular person. Any advice contained on this page and on this website is General Advice and does not take into account any person’s particular investment objectives, financial situation and particular needs.

Before making an investment decision based on this advice you should consider, with or without the assistance of a securities adviser, whether it is appropriate to your particular investment needs, objectives and financial circumstances. In addition, the examples provided on this page and on this website are for illustrative purposes only.

Although every effort has been made to verify the accuracy of the information contained on this page and on this website, Camden Professionals,its officers, representatives, employees, and agents disclaim all liability [except for any liability which by law cannot be excluded), for any error, inaccuracy in, or omission from the information contained in this website or any loss or damage suffered by any person directly or indirectly through relying on this information.

Absentee Owner Surcharges | Duties Act 2000 (Victoria)

From the 2020 land tax year, an absentee owner surcharge of 2% applies to Victorian land owned by an absentee owner. The surcharge was 1.5% from 1 January 2017 and 0.5% for the 2016 land tax year.

The absentee owner surcharge is an additional amount that applies over the land tax you pay at general and trust surcharge rates.

1. What is an absentee owner?

An absentee owner is an absentee person that owns land in Victoria, and can be:

• an absentee individual,
• an absentee corporation, or
• a trustee of an absentee trust.

Each of these terms has a specific meaning.

We recommend that you speak to your accountant to clarify whether status as an Absentee Owner applies to you.

2. When will the surcharge apply?

If you are an absentee owner at 31 December, the surcharge applies in the following land tax year.

The surcharge is calculated on the total taxable value of Victorian land you own and will be included on your Victorian land tax assessment. The surcharge calculation depends on who owns the land and how they own it. For example, if the land is jointly owned, owned by an absentee corporation that is part of a land tax group or owned by a trustee of an absentee trust that is a discretionary trust, unit trust or fixed trust.

The surcharge does not apply if land is exempt from land tax or if the total taxable value of your land(s) is below the threshold of $250,000 or $25,000 (if the land is held on trust and is subject to the trust surcharge rate).

3. Notification as an Absentee Owner

If you are an absentee owner at 31 December, you must notify the State Revenue Office, Victoria by no later than 15 January of the following year (2021).

Once you have notified that you are an absentee owner, your land tax assessments will include the absentee owner surcharge.

Failure to report as an absentee owner is a notification default under the Taxation Administration Act 1997. If this happens, you will be liable for penalty tax on the surcharge amount of land tax assessed in accordance with our revenue ruling on penalty tax and interest. This may be penalty tax of:

• 5% if you voluntarily advise that you are an absentee owner before an investigation,
• 20% if you advise you are an absentee owner after an investigation is commenced,
• Up to 90% if you intentionally disregarded the law and hindered any investigation.

4. Can a Foreign Trust be exempt from the surcharges?

The absentee owner surcharge is payable where the trust in question has a named beneficiary who is a foreign person. In order to become exempt from this surcharge, the trust must exclude the foreign person as a beneficiary of the trust.

However, as the exclusion would apply to a named beneficiary, this action may cause a resettlement of the trust and create capital gains tax consequences. Therefore, the ability to avoid payment of this surcharge is limited, and if this surcharge applies to your trust, you should contact your accountant for further guidance.

– Absentee corporations

An absentee person who holds a controlling interest in an absentee corporation may, in some circumstances, be eligible for an exemption. The effect of the exemption is that the absentee person, who holds a controlling interest in the absentee corporation, is taken to not hold that controlling interest. The result is that the corporation owning the land will not be considered an absentee corporation, and therefore will not be subject to the absentee owner surcharge.

The exemption is only available to an absentee person who holds a controlling interest in a corporation that is incorporated in Australia and owns land in its own right. It does not apply to an absentee corporation that is incorporated outside Australia.

– Absentee trusts

From the 2018 land tax year, an absentee beneficiary in relation to an absentee trust may, in some circumstances, be eligible for an exemption.

The effect of the exemption is that the relevant absentee beneficiary is taken to not be an absentee beneficiary. If the exemption has been granted to all of the absentee beneficiaries, then the trust is not considered to be an absentee trust and not subject to the absentee owner surcharge.

*Note: The exemption is not intended to apply where the absentee corporation or trustee of an absentee trust is merely a property investor or landlord.

We strongly recommend that you contact our office to discuss your Property Trust Structures and to check your eligibility for an exemption.

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General Advice Warning

The material on this page and on this website has been prepared for general information purposes only and not as specific advice to any particular person. Any advice contained on this page and on this website is General Advice and does not take into account any person’s particular investment objectives, financial situation and particular needs.

Before making an investment decision based on this advice you should consider, with or without the assistance of a securities adviser, whether it is appropriate to your particular investment needs, objectives and financial circumstances. In addition, the examples provided on this page and on this website are for illustrative purposes only.

Although every effort has been made to verify the accuracy of the information contained on this page and on this website, Camden Professionals,its officers, representatives, employees, and agents disclaim all liability [except for any liability which by law cannot be excluded), for any error, inaccuracy in, or omission from the information contained in this website or any loss or damage suffered by any person directly or indirectly through relying on this information.

Discretionary Trusts in NSW: Foreign Persons – Surcharge land tax & purchaser duty

Recently enacted changes to purchaser duties and land tax arrangements will expand surcharges for trusts which include foreign persons as beneficiaries.

Legislation passed to amend the Land Tax Act 1956 (NSW) and the Duties Act 1997 (NSW) provides that if a trust has a foreign person that holds a substantial interest in a Trust, and that Trust holds residential land in NSW, that land will be subject to a land tax surcharge of 2% for currently held NSW residential land, and a stamp duty surcharge of 8% for new NSW residential land acquisitions by the Trust.  These changes came into effect from the 2017 land tax year.

Further legislation that came into effect this year clarified that all discretionary trusts will be automatically captured for the purposes of these surcharges even if they don’t have foreign persons as beneficiaries unless the trust deed for the trust does, or is amended to, specifically exclude foreign persons as beneficiaries of the Trust.

Surcharge purchaser duty applies to acquisitions of NSW residential land by foreign persons, and surcharge land tax applies to foreign persons who are owners of residential land in NSW. Surcharge purchaser duty and surcharge land tax (together, the foreign surcharges) are payable in addition to any other duty or land tax payable.

Where an interest in a property is acquired directly or indirectly by or held through a discretionary trust, the trustee of the trust may be liable for foreign surcharges if any one of the potential beneficiaries is a foreign person.

1. Changes to the Duties Act (1997) and section 5D of the Land Tax Act (1956) have the effect of:

• Confirming that all discretionary trusts that hold land in NSW will be liable for a land tax surcharge of an additional 2%,
• Unless the trust deed for the Trust is specifically amended to exclude foreign persons as beneficiaries of the Trust,
• Trustees of discretionary trusts may have the opportunity to be refunded the land tax surcharge if they have paid this surcharge for the 2017, 2018 and 2019 land tax years,
• And they amend their trust deed to exclude the foreign persons prior to 31 December 2019”.

The changes may apply to you, and it is important to contact your Accountant before December 1, 2020 to determine whether the legislative changes applies to you.

2. The rules are changing: ‘Foreign Persons’, stamp duty and land tax

It is important to note that, depending on your circumstances, you may need to make urgent (by 31 December 2020) changes to your trust deed, to ensure that you don’t pay additional surcharges.

Surcharge purchaser duty applies to acquisitions of NSW residential land by foreign persons, and surcharge land tax applies to foreign persons who are owners of residential land within NSW.

Surcharge purchaser duty and surcharge land tax are payable in addition to any other duty or land tax payable. Where an interest in property is either acquired by, or held through a discretionary trust, the trustee may be liable for these surcharges if any one of the ‘potential beneficiaries’ is a foreign person (see Duties Act 1997 section 104JA).

You might be wondering why you need to be concerned about foreign beneficiaries with respect to your family trust – after all, the named beneficiaries in your family trust deed are all Australian citizens? This is due to the fact that a ‘potential beneficiary’ is not limited to the beneficiaries who are named in the trust deed.

3. What is a ‘Potential Beneficiary’

Example A: | Amend your Trust Deed by 31 December 2020.

Revenue NSW provides the example of Mr and Mrs Jones and their children Mark and Peter, who are both toddlers.  All four of the Jones family are each named as a primary beneficiary in the trust deed and are all Australian citizens.

As is common with family trust deeds, the deed also nominates beneficiaries by class.  In this case, there is a class specified as a ‘spouse or child of a primary beneficiary’.  This is to take into account a possible change in circumstances, or because the beneficiary does not exist when the deed is executed.

Clearly the trust has no existing foreign beneficiaries – however, the future spouse and children of Mark and Peter could potentially be foreign persons.

Revenue NSW advise that “A person is a ‘potential beneficiary’ of a discretionary trust if the exercise or failure to exercise a discretion under the terms of the trust can result in any property of the trust being distributed to or applied for the benefit of the person.”

In this example, the trustee is taken to be a foreign person, and will therefore be liable for both surcharge stamp duty and land tax.

To be exempt from foreign surcharges, the Jones must amend the trust deed to exclude any foreign beneficiaries (“no foreign beneficiary requirement”) and the no foreign beneficiary requirement must be irrevocable (“no amendment requirement”).

4. Transitional Provisions | Guidelines

No foreign beneficiary requirement

• If the trustee of a discretionary trust is liable for surcharge purchaser duty on a transfer of dutiable property that occurred before 24 June 2020, or after that date but before midnight on 31 December 2020, the trustee will still not be liable if the terms of the trust have been amended before midnight on 31 December 2020.
• If surcharge purchaser duty was paid, the trustee is entitled to a refund if the amendment is made before midnight on 31 December 2020.
• If the trustee of a discretionary trust is liable to pay surcharge land tax in respect of the 2017, 2018, 2019 and/or 2020 land tax year, the trustee will still not be liable if the terms of the trust have been amended before due date for the payment of land tax or after the due date but before midnight on 31 December 2020.
• If surcharge land tax was paid, the trustee is entitled to a refund if the amendment is made before midnight on 31 December 2020.

5. No Amendment Requirement

If before 24 June 2020, a trust satisfied the no foreign beneficiary requirement under section 104JA of the Duties Act 1997 or section 5D of the Land Tax Act 1956, the trustee will be exempt from surcharge purchaser duty and surcharge land tax without having to satisfy the no amendment requirement.

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General Advice Warning

The material on this page and on this website has been prepared for general information purposes only and not as specific advice to any particular person. Any advice contained on this page and on this website is General Advice and does not take into account any person’s particular investment objectives, financial situation and particular needs.

Before making an investment decision based on this advice you should consider, with or without the assistance of a securities adviser, whether it is appropriate to your particular investment needs, objectives and financial circumstances. In addition, the examples provided on this page and on this website are for illustrative purposes only.

Although every effort has been made to verify the accuracy of the information contained on this page and on this website, Camden Professionals,its officers, representatives, employees, and agents disclaim all liability [except for any liability which by law cannot be excluded), for any error, inaccuracy in, or omission from the information contained in this website or any loss or damage suffered by any person directly or indirectly through relying on this information.