SMSF Land Tax

Do SMSF’s need to pay Land Tax ?

SMSF’s and their members and trustees all fall under the category of owners and where freehold property is purchased within an SMSF, then the fund may be liable to pay land tax on land owned directly by the fund. The good news is, complying SMSF’s are entitled to a land tax threshold in some states of Australia.

Warning: This is general information only you must seek advice on your situation regarding, land only, house and land and existing property purchases from a Tax Agent or Lawyer.

Who Pays Land Tax

Land tax is payable on all houses, units and land which is not earning any income, calculated from midnight on the 31st of December of each year in NSW & VIC. In other states, WA, SA, QLD it is calculated on the 30th of June of each year. The only exclusion or total exemption from paying land tax is a principal place of residence and primary production land in most states.

New South Wales:

The land tax-FREE threshold is $629,000 for the 2018 Calendar Year

http://www.osr.nsw.gov.au/taxes/land/ 

Land tax payable in New South Wales is determined on the taxable value of land holdings as at 31 December each year. The threshold below which no tax is payable is $629,000 for SMSF’s. Above $629,000 land tax is $100 + 1.6% on the land value of the property.  The premium land tax threshold for the 2017 land tax year is $3,846,000  and is taxed at 2% above the land value

Victoria:

The land tax-FREE threshold is $250,000 for the 2018 Calendar Year

http://www.sro.vic.gov.au/ltxcurrentrates

SMSF would receive up to a $250,000 land tax-free threshold for residential properties. Commercial farm and primary production land could qualify for further land tax concessions or total exemptions from land tax levies

Payments

If the land tax assessment is greater than $200 you can choose to pay in full within 19 weeks or in four instalments over a 37-week period. If you have chosen the instalment option, you must pay each instalment by the due date to remain on the instalment program.

Queensland:

The land tax-FREE threshold is $350,000 for the 2017-18 year

http://www.qld.gov.au/environment/land/tax/calculation/value/

Land tax in Queensland is levied on the aggregate of the unimproved value of all freehold land owned in Queensland as at midnight on 30 June each year and taxed at 1.7% above the $350,000 – $2,249,999. The exemption for land tax applies to individuals who own a home or agricultural or primary production business. Various rates of tax apply to amounts above the threshold. 

Payment

Land tax can be paid by a single payment which is payable by 90 days from the date of the assessment or using the extended payment option by 3 equal payments due 45, 90 and 150 days after the date of assessment. The specific due dates for each payment are stated in your assessment notice.

Western Australia:

The land tax-FREE threshold is $300,000 for the 2017-18 year

https://www.finance.wa.gov.au/cms/State_Revenue/Land_Tax/What_is_Land_Tax_.aspx

Land tax in Western Australia is assessed on the basis of the unimproved value of land holdings as at 30 June each year. The tax threshold for the 2017-18 land tax year is $300,000.  Land tax is applied at varying rates commencing at 0.25% – 2.67% for land value over $11 million in value. 

W.A also applies a Metropolitan Region Improvement Tax (MRIT). Land in Perth and environs valued at above $300,000 are taxed at a flat rate of 0.14%, in addition to the general land tax imposed. 

South Australia
The land tax-FREE threshold is For the 2017-18  is $353,000
https://www.revenuesa.sa.gov.au/taxes-and-duties/land-tax/frequently-asked-questions
In South Australia, land tax is applied to the value of
any property owned or jointly owned that is above the
land tax threshold as at midnight on 30 June.
We have not included Land tax rates for NT, ACT and Tasmania, due to lack of interest in these states.
 
Seek Advice: This is general information only. obtain a legal opinion or a land tax calculation from a practicing accountant or lawyer