Land tax ownership types
Different types of ownership structures can impact how land tax is assessed. Learn about how land tax in NSW is assessed for different types of landowners.
New land tax website launching Monday 5 May
We're making it easier for you to understand and manage your land tax with a new website featuring streamlined design, clearer information on how land tax is calculated, and faster access to Land Tax Online. Learn more about the updates and how they will benefit you.
Types of land ownership structures
You can purchase property in NSW as:
- an individual/sole owner
- a joint owner
- a company – whether solely or part of a group of related companies
- an owner of company title units
- a trustee of any trust
- a beneficiary of a trust (that is not a special trust)
- a unit trust holder (in some instances)
- a society or organisation whose land is not exempt from land tax
- a trustee of a superannuation fund
- a lessee of crown or local council land
How individuals and sole owners are assessed
You are assessed based on the total land value of all your interests in land, whether you own them as an individual or as a joint owner.
For example, if you have a 50% interest in jointly owned land, your individual tax assessment will include 50% of that land plus 100% of any land you own individually.
You will receive separate assessment notices for any jointly owned land.
How joint owners are assessed
If you own land with one or more additional owners, you are considered a joint owner of land.
Under section 27 of the Land tax Management Act 1956 Revenue NSW assess jointly owned land as if it were owned by one person. The partnership receives the benefit of the one threshold.
As a joint owner, you will be assessed as follows:
- The joint owners together are called the “primary taxpayer” and are assessed as if they are a single owner.
- Each joint owner is called a “secondary taxpayer” and will be assessed separately on all their interests in land, with their share of each jointly owned parcel of land added to the value of each parcel of land that they own individually.
Where tax is paid by the joint owners, each joint owner is entitled to a secondary deduction in their separate assessments to avoid double taxation.
This video covers the two-stage assessment process for land tax in NSW and how it relates to the joint ownership of land and secondary deductions.
Joint ownership and secondary deductions | Overview from Revenue NSW on Vimeo.
How trusts are assessed
Read more information on how trusts are assessed.
Land tax calculation examples
Read more about the land tax thresholds and rates used in the examples below.
You can also estimate the amount of your land tax and surcharge land tax liability in NSW by using the Land Tax Calculator.
Landowners | John and Jane |
|---|
Property ownership | Property A
John and Jane own 100% of the property
Land value = $1,200,000 |
|---|
Calculation | $1,200,000 (total land value) - $1,075,000 (general land tax threshold) x 1.6% + $100 (general land tax rate) = $2,100 |
|---|
Land tax payable | $2,100 |
|---|
Landowner | John |
|---|
Property ownership | Property A
John owns 50%
Land value = $600,000 Property B
John owns 100%
Land value = $550,000
An individual assessment applies to John's 50% share of Property A (50% of $1,200,000 = $600,000) and to the total value of Property B ($550,000) combined. |
|---|
Individual calculation | $1,150,000 (total land value) - $1,075,000 (general land tax threshold) x 1.6% + $100 (general land tax rate) = $1,300 |
|---|
Secondary deduction calculation A | (Interest in primary ÷ total primary) x tax in primary ($600,000 ÷ $1,200,000) x $2,100 = $1,050 |
|---|
Secondary deduction calculation B | (Interest in primary ÷ total secondary) x tax in secondary ($600,000 ÷ $1,150,000) x $1,300 = $678.26 |
|---|
Land tax payable | $1,300 – $678.26 = $621.74 The allowable deduction ($678.26) is the lesser of the two calculations and this amount is deducted from the total amount of land tax ($1,300) in individual assessment. |
|---|
Landowner | Chris |
|---|
Property ownership | Property D
Chris owns 100%
Land value = $3,500,000 Property E
Chris owns 100%
Land value = $3,500,000 |
|---|
Calculation | $7,000,000 (total land value) - $6,571,000 (premium land tax threshold) x 2% (premium land tax rate) + $88,036 (maximum general land tax payable) = $96,616 |
|---|
Land tax payable | $96,616 |
|---|
Contact the land tax team
If you have a question about land tax contact us.
