Usual Land Tax Assessment process

Each Council/Shire engages a Licensed Valuer for the purpose of valuing each property in their municipality in respect of:

1. The Capital Improved Value (CIV) – Land plus any improvements
2. Site Value/Unimproved Land Value – Land Only

If you conduct any building activity including obtaining certain permits, the council/shire can issue an Amended Rates Notice at any time.

The Council/Shire will declare a range of rates during their annual budgeting process that will then been multiplied usually by the CIV to determine the annual council/shire rates payable by the land owner.

The rates will vary depending upon the use and the relevant planning scheme that applies to the land. For instance there will generally be different rates per dollar for:

1. Residential Land containing a dwelling
2. Vacant Residential Land
3. Industrial Land
4. Vacant Industrial Land
5. Farm Land
6. Native Vegetation etc.

Objecting a Council/Shire Rates Notice

You usually have 60 days to object to a Council/Shire Rates Notice from the issue date, with most objections being:

• Inappropriate valuation
• Assessed area being incorrect
• Incorrect classification/rate applied
• Property no longer owned etc.

The Council/Shire then provides the following two values to the SRO:

1. Site Value – used to produce the Land Tax Assessments
2. CIV – used to calculate Vacant Residential Land Tax

The 2025 Land Tax Assessments take into account land held at midnight on 31 December 2024 and use the value as prepared by councils in 2024.

Is your Land Tax assessment correct?

You also have 60 days to object to a Land Tax Assessment from the issue date.

In addition, as Land Tax is a self-assessment system you need to consider whether:

1. all the land you or the entity owns is included and the apportionment is correct
2. dimensions and description of the land being valued are correct
3. is any land which you have bought/sold disclosed?
4. if you receive multiple assessments for the same own – for instance individuals name may be spelt wrong etc
5. any exemptions are correctly applied – for instance primary production land, principal place of residence, exempt status etc
6. whether Absentee Owner Surcharge should be or should not be charged
7. whether any Vacancy Residential Land Tax has been correctly assessed
8. land subject to the Trust surcharge has been correctly assessed
9. correct ownership is disclosed – trust as opposed to company etc.

It is often easier to object against the Council Rates Notice  as in essence this information is then fed through to the SRO.

Where the valuation is not appropriate, it is prudent to obtain supporting evidence which in many cases will  include a formal Valuation from a Property Valuer to support a lower and correct valuation.

There is a cost/benefit assessment to be done when lodging an objection.

How SW can help

To assist you we can:

• review the Land Tax Assessments to ensure that you are correct – remembering that it is a self-assessment system
• consider whether the Site Value is appropriate and if not consider lodging an objection.

The post Land Tax Assessments 2025 | What you need to know appeared first on SW Accountants & Advisors.

Introduction of Bill includes a further exemption

State Taxation and Treasury Legislation Amendment Bill 2022 (part 8) provides an exemption from the Windfall Gains Tax for land owned by a university in certain circumstances. 

Background

The windfall gains tax (WGT) was announced in the 2021-22 Victorian Budget and the legislation received royal assent on 30 November 2021.  See our article on the Windfall Gains Tax and subsequent article on the charity land tax exemption for further detail.

The WGT will apply from 1 July 2023 and imposes a tax on land that receives an uplift in value as a result of rezoning at the following rates:

The Government wrote to universities in October 2021 to advise that charities would be exempt from the WGT where they owned and used the land for 15 years after the rezoning.  This exemption was included in the legislation that was passed in November 2021. 

Proposed WGT exemption for universities

The current bill has now proposed to provide an even broader exemption for universities than the 15 year charity exemption.  This broadening of the exemption is positive news, but universities should still understand that the exemption remains subject to the Commissioner’s approval and conditions.

Conditions for exemption

The proposed WGT exemption for universities will apply where it meets all of the following:

• the land is owned by a university
• the university is a charity, and
• the Commissioner is satisfied that any land revenue from the land will be used to further the university’s charitable purpose.

To access the exemption the university must provide to the Commissioner with a declaration as to:

• the nature of any land revenue form the land
• the intended application of the land revenue, and
• how the application of the land revenue will further the university’s charitable purpose.

Land revenue means any revenue arising from the sale or use of the land, including any of the following:

• sale proceeds from the sale of the land
• rental income from leasing the land
• licence fees from licensing the land.

How SW can assist

The SW Education team works closely with a large number of Victoria’s universities and has extensive experience in advising and assisting them to navigate financial complexities. Should your university be in the process of rezoning Victorian land and require any further advice on this issue please contact either Stephen O’Flynn or Steve Allan.

The post Broader university exemption for Windfall Gains Tax, VIC appeared first on SW Accountants & Advisors.