(Section 9C Land Tax Management Act, 1956)
|Ruling number||LT 040|
|Date issued||15 October 1992|
|Issued by||B Buchanan |
Chief Commissioner of Land Tax
|Effective from||1 January 1991|
|Effective to||15 August 2008|
|Status||Replaced by LT 082|
Up to and including the 1990 tax year, an owner of land was entitled to a reduction in tax where the land was used as the owner's residence and contained other premises.
Effective from the 1991 tax year, the reduction in tax is replaced by a reduction in the adjusted value. This new concession, based on the proportion of the adjusted value relating to the owner's residence, is called the allowable proportion.
Where land is used for residential and commercial purposes, the Valuer-General may determine a Mixed Development Apportionment Factor (MDAF) representing that part of the adjusted value relating to the commercial use of the land.
The purpose of this Ruling is to explain the methods of calculating the allowable proportion, to outline the conditions that must be met and to advise how to apply for the concession.
Where an MDAF has been determined and an owner's residence is the only residence on the land, the allowable proportion is the remainder of the adjusted value after deducting the MDAF. If there are two or more residences on the land, the remainder of the adjusted value is reduced in the proportion that the floor area of the owner's residence bears to the floor area of all residences on the land, including that of the owner.
Where an MDAF has not been determined by the Valuer-General, an owner must claim a proportion of the adjusted value considered to apply to that owner's residence and this may be accepted as the allowable proportion. If the Chief Commissioner of Land Tax is not satisfied that a claim is fair and reasonable, the allowable proportion will be the proportion that the floor area of the owner's residence bears to the floor area of all buildings on the land, including the owner's residence.
Where the area of the land exceeds 2,100 square metres, the allowable proportion is reduced in the proportion that 2,100 square metres bears to the total area of the land.
The new concession is available only where:
part of the building or buildings on the land was used as an owner's residence and for no other purpose;
that owner was not a trustee [other than a "Trustee company" (as defined)]; and
that owner was not a company or a person owning the land jointly with a company (a company does not include a "Trustee company").
Owners of land who received a concession for the 1990 tax year and whose circumstances are unchanged will automatically receive the new concession and they need do nothing.
Owners of land who did not receive a concession for the 1990 tax year or owners who received a concession for the 1990 tax year but whose circumstances have changed are required to claim the new concession.
A standard application form for use by owners who wish to apply for the concession is attached to this Ruling. The application, which is in the form of a statutory declaration, should be posted to the Chief Commissioner at the following address:
Office of State Revenue
Revenue Advisory Services
Post Bag 5215
Parramatta NSW 2124
but may also be lodged at any branch of the Office of State Revenue from where additional copies of the form can be obtained.
The Chief Commissioner should be advised of any change in the circumstances outlined in the application for concession as soon as possible after the change.