The NSW Government has introduced measures to provide relief to commercial and residential landowners, who provide a reduction in rent to a tenant who is experiencing financial distress as a result of COVID-19.

The 2021 land tax COVID-19 (1 July 2021 to 31 December 2021) relief announced on 14 July 2021, is intended to reduce a landowner’s land tax payable for 2021, by up to 100 per cent, for a taxable parcel of land where rent relief has been given to the tenant who occupies that land.

The NSW Government has also introduced a range of support payments  for properties tenanted in NSW. A property is only able to receive either the 2021 land tax COVID-19 relief, the Residential Tenancy Support Payment or the Commercial Landlord Hardship Fund. Landowners should consider which relief option is most appropriate for them before applying. More information about these support payments is available via Service NSW.

Reduction in land tax payable

A landowner can receive a reduction of up to 100 per cent of land tax payable for the 2021 land tax year, subject to the terms of these guidelines.

A landowner providing a reduction in rent to a tenant between 1 July 2021 and 31 December 2021 can receive a reduction in land tax payable for the relevant parcel of land. The land tax reduction will be the lesser of:

• the amount of rent reduction provided to an eligible tenant for any period between 1 July 2021 and 31 December 2021, or
• 100 per cent of the 2021 land tax attributable to the parcel of land leased to that tenant.

Landowners can be eligible for land tax relief provided all eligibility requirements are met.

Landowners can also be eligible for land tax relief for either, or both 2020 land tax COVID-19 relief and 2021 land tax COVID-19 relief, provided all eligibility requirements are met.

Land tax attributable to a parcel of land is calculated as follows:

Taxable value of the parcel of land divided by aggregate taxable value of all parcels of land, multiplied by landowner’s 2021 land tax liability.

If you haven’t completed payment of your land tax for 2021, the relief granted will be used to offset the balance of land tax you have left payable. If your land tax for 2021 has been paid in full, the reduction can be refunded to you.

You’ll be eligible if:

• you’re leasing a parcel of land to:
  • a commercial tenant, who has an annual turnover of up to $50 million and is eligible for the Micro-business COVID-19 Support Grant, the 2021 COVID-19 NSW Business Grant and/or the JobSaver scheme, or
  • a residential tenant who has had a reduction in household income of 25 per cent (or more) as a result of COVID-19,
• you reduce the rent of the affected tenant for any period between 1 July 2021 and 31 December 2021, and
• for 2021, you have land tax attributable to the parcel of land leased to that tenant.
• You are not claiming either:
  • The Commercial Landlord Hardship Fund, or
  • The Residential Tenancy Support Payment.

Before applying, you’re responsible for verifying that your;

• residential tenant is in financial distress, and/or
• commercial tenant is eligible for the Micro-business COVID-19 Support Grant, the 2021 COVID-19 NSW Business Grant and/or the JobSaver scheme.

Rent reduction

To be eligible, the rent reduction must not be required to be paid back at a later date. If a reduction in rent is provided but is required to be paid back at a later date, this is considered to be a deferral of rent and won’t be considered as a reduction of rent under this program.

If you’re not eligible for relief under this program but you’re having difficulty paying, you can still apply for a payment plan to extend your payment dates.

Relief under this program is being provided under section 5.7 of the Government Sector Finance Act 2018 (the GSF Act) and is subject to the terms and conditions as set out in these guidelines (section 5.7(2) of the GSF Act).

You acknowledge that the following terms and conditions are essential and, if any are contravened, you may be required to repay the relief (section 5.7(3) of the GSF Act):

1. You are being provided relief on the basis that your application, including any statements, information or documentation provided to demonstrate that you satisfy the eligibility criteria, is true and accurate.
2. If there is a change in your circumstances affecting your eligibility after an application is submitted for phases 1, 2, 3 and 4, you must notify us by submitting an amended application by 30 April 2022. This includes a change in tenant or a change in rent during the period for which an application has been submitted. An amended application may result in a change to the amount of relief previously provided to you and you may be required to repay all or part of the relief.
3. Your relief is calculated as at your 2021 land tax liability at the time your application is determined. If there is any reassessment of your 2021 land tax liability after relief is provided under this program, your relief may be recalculated, and you may be required to repay all or part of the relief.
4. You consent to Revenue NSW disclosing information about your 2021 COVID-19 land tax relief application to NSW Fair Trading in the Department of Customer Service to assist NSW Fair Trading to administer the Residential Tenancy Support Payment.
5. You consent to Revenue NSW disclosing information about your 2021 COVID-19 land tax relief application to Service NSW in the Department of Customer Service to assist Service NSW to administer the Commercial Landlord Hardship Fund.

You also acknowledge that:

• Applications submitted for this program will be subject to potential compliance review for legitimacy.
• Eligibility of both landowners and tenants can be reviewed to confirm that relief under this program has been correctly requested and applied for.
• Providing false or misleading information in an application for 2021 land tax COVID-19 relief, or not notifying us of a change in your circumstances, may result in a land tax reduction under this program being revoked. If you are required to repay the relief and do not do so, the relief may be recovered from you as a debt. It’s also an offence to provide false or misleading information and penalties may apply.

Commercial

Used for business

Landowner

Has the same meaning as ‘owner’, as defined in the Land Tax Management Act 1956

Land tax year

Has the same meaning as defined in the Land Tax Management Act 1956

Residential

Used for a private place of residence

Taxable value

Has the same meaning as prescribed in section 9 of the Land Tax Management Act 1956