Land tax exemptions
Two main land tax exemptions apply in each state that charges land tax. One covers the home of the owner, called the principal place of residence. The other covers land used for farming purposes, called primary production land. Other, smaller exemptions apply to deceased estates, to periods of time away from home, to boarding or rooming houses, and to charities. The threshold is applied only after exempt land has been taken out of the total.
Land tax home exemption
No tax is charged on the home where the owner lives. Each state has its own rules about who counts as living there.
- **NSW and Victoria use the name principal place of residence exemption. It is often shortened to PPR. Victoria places your home first on its list of exempt land.
- **Queensland provides a home exemption, and an owner can count only one property as a home, in that state or elsewhere. QRO says no separate exemption exists for seniors or pensioners.
- **In Western Australia, land is exempt if a person owns it and lives there as their main home, or if a couple owns it and at least one of the couple lives there.
- **For South Australia, the home must be a permanent building and occupied on a continuing basis, not just temporarily. Caravans and tents do not qualify for the exemption.
- **In Tasmania, a home counts as principal residence land if an owner of at least half of it lives there on 1 July. Ordinarily, a weekend home does not qualify.
- **In the ACT, no land tax is charged on a home where the owner was living on the quarter's first day.
An exemption does not always apply automatically. For Queensland, you need to apply for them. In NSW, company-owned or trust-held homes must pay land tax if the stated conditions are not met.
Primary production land tax exemption
Land used for a farming business may be exempt. Under Revenue NSW, primary production land means land used dominantly for purposes like raising animals, growing crops for sale, or keeping bees. Zoning of rural, rural residential or non-urban can make NSW land eligible, but the produce has to be sold.
What Victoria looks at is whether the land sits in greater Melbourne and whether it is in an urban zone. In Queensland, the land must be used solely for a primary production business.
Time away from home and the six-year rule
When an owner moves out, the home exemption may last for a while. Victoria limits the temporary absence provision to 6 years counted from the date the absence began. Two conditions apply here: the owner has lived there for at least six months, and plans to move back.
NSW offers a similar concession running for up to 6 years. Six months of living there must come first, and the home must not be rented out for more than six months in any calendar year.
Land tax exemption for a deceased estate
After an owner dies, the home may remain exempt for a period. In NSW the exemption lasts until someone outside the estate takes ownership, or for 2 years counted from the date of death, whichever comes first.
In Western Australia, the home is exempt for the assessment year that follows the financial year of death, as long as the estate takes no rent from it. RevenueSA says deceased estates may qualify for some exemptions under specific conditions.
Land tax exemption for a boarding house
Low-cost housing can sometimes be exempt. A boarding house in NSW may qualify if, in the previous year, long-term residents made up at least 80% of occupants and tariffs stayed under the maximum. Victoria grants an exemption to a registered rooming house that mainly provides low-cost accommodation.
Other relief and discounts
Some relief cuts the tax rather than exempting the land fully. Among the relief Queensland offers are a discount for subdividers and build-to-rent concessions. Several states exempt charitable institutions, and those states include Victoria and Queensland.
Questions
Who is exempt from land tax?
What decides an exemption is how the land is used, not who owns it. Farm land, charities, some low-cost housing and the home are the main exempt uses. On a rental, a pensioner still pays; Queensland says there is no exemption aimed specifically at seniors or pensioners.
Do you pay land tax on your home?
No, as long as the owner actually lives there and the state's conditions are met. Tax usually applies to a second home, to a holiday house, or to a home owned through most trusts.
How does the six-year rule for land tax work?
In Victoria and NSW, owners who move out may hold the exemption for their home for up to six years. That applies when they lived there before and the office's conditions are met. Every state has its own version of the rule.
Does primary production land get a land tax exemption?
Usually, land used for a farming business qualifies if it meets the state's test. Stricter rules apply where land is near a capital city or is zoned urban.
Is there a land tax exemption for a deceased estate?
Yes, and in most states the exemption lasts for a limited time. After the death, NSW allows the home to stay exempt for up to two years; Western Australia allows it for the following assessment year, provided no rent is earned.