22 November 2021
Current COVID-19 Land Tax Relief Measures
In 2020, each state and territory introduced a number of land tax relief measures to alleviate the impacts of COVD-19. Below we discuss the current relief measures for each state and territory:
Victoria
The Victorian Government introduced land tax relief measures which allow for land tax reductions and deferrals for landlords of commercial tenancies, and commercial owner-occupiers.
Single commercial tenancies
Landlords who provided rent relief consistent with the Commercial Tenancy Relief Scheme between 28 July 2021 and 15 January 2022 to an eligible tenant are eligible for a reduction of 25% on 2021 land tax for a relevant property.
Eligible landlords are also able to defer paying the remainder of their 2021 land tax assessment until or before, 31 May 2022.
Multiple commercial tenancies
Landlords who provided rent relief consistent with the Commercial Tenancy Relief Scheme for multiple commercial tenancies between 28 July 2021 and 15 January 2022 to eligible tenants are also eligible for a reduction of land tax equal to the total amount of rent waived up to an amount not exceeding 25% of 2021 land tax for the relevant property.
Eligible multi-tenancy landlords may also be able to defer payment of the remainder of their 2021 land tax assessment until, or before, 31 May 2022.
Commercial owner-occupiers
Eligible landowners who:
- hold an Australian Business Number;
- carry on a commercial the business on the property or directly or indirectly control a business carried out on the property; and
- would otherwise have been an eligible tenant under the Commercial Tenancy Relief Scheme,
are eligible for a 25% reduction of 2021 land tax for the relevant property.
Eligible landlords may also defer paying the remainder of their 2021 land tax assessment until or before, 31 May 2022.
Applications for land tax relief close 30 April 2022 and more information can be found here https://www.sro.vic.gov.au/2021-coronavirus-land-tax-relief.
New South Wales
The New South Wales government have announced land tax relief measures for residential or commercial landlords who have reduced their tenant’s rent due to Covid-19 during the period 1 July 2021 and 31 December 2021.
The land tax reduction will be the lesser of the amount of rent reduction provided to an eligible tenant for that period or 100% of the land tax attributable to the parcel of land leased to the tenant.
To be eligible, the landlord must:
- be leasing the property to either:
- a commercial tenant who has an annual turnover of up to $50 million, and is eligible for a microbusiness COVID-support grant, 2021 covid-19 NSW business grant and/or the jobsaver scheme; or
- a residential tenant who has lost 25% or more of a household income due to COVID-19,
- have reduced the rent of the affected tenant for any period between 1 July 2021 and 31 December 2021 and provided that rent reduction was without any requirement for repayment.
More information can be found here https://www.service.nsw.gov.au/transaction/apply-covid-19-land-tax-relief.
Australian Capital Territory (ACT)
Commercial Landlords
Although there is no land tax relief for commercial landlords, commercial landlords can receive 50% of any rent reduction provided to business tenants as a rebate from the government, capped at the lower of $10,000 or the amount equal to two quarters of rates for 2021-22.
Eligibility
To be eligible for the rebate, landlords need to have, during the period from 1 August 2021 to 31 December 2021:
- reduced (not deferred) rent for a business tenant impacted by covid-19, which tenant must have an annual turnover of less than $50 million and experienced a decline in turnover of 15% for a not-for-profit business, or 30% for other businesses; and
- reduced (not deferred) the tenant’s rent for a period of at least 4 weeks during the assistance period; and
- engaged in good faith negotiations with the tenant regarding rent reduction.
Residential Landlords
Residential landlords can receive a land tax credit to cover 50% of any rental reduction during the period of 1 August to 31 December 2021, up to a limit of $100 per week.
Eligibility
To be eligible for that rebate, residential landlords need to have, during the period from 1 August 2021 to 31 December 2021, reduced (not deferred) the rent paid by a person renting and residing in the property by at least 25% and for at least four weeks during the period. The lease must also be to person and not a company in the business of short-term rentals.
Further information can be found here https://www.revenue.act.gov.au/covid-19-assistance.
Queensland, Western Australia and South Australia
Those governments announced several land tax relief measures in response to COVID-19 in 2020 for 2020-21 year. However, applications for these measures have closed and will no longer apply for the 2012-22 year.
Tasmania
Currently, there is no specific information regarding covid relief measures for 2021. However, the Tasmanian government website indicates that landlords currently experiencing financial hardship in paying land tax may apply for a payment agreement by completing a debt payment arrangement application online.
Further information can be found here https://www.sro.tas.gov.au/about-us/covid-19.
Northern Territory
Land tax is not payable in Northern Territory. As such no relief measures were offered.
How we can help you
JHK Legal has extensive experience in providing advice on property and commercial matters.
If you require any further information or any assistance to determine your eligibility for the above land tax relief measures or any other property or commercial matter, please reach out to the JHK Legal team to obtain advice.
Written by Rachel Feng, Lawyer