Australia Land Tax – An Introduction

Can You Avoid Remitting Your Land Tax?

It is possible to stop paying your monthly land tax. However, that would mean you also stop purchasing more properties. 

How would that sound?

I guess you wouldn’t want to give up on your investment property business.

So, what should you do instead?

Let’s find out!


No Land Tax Remittance on your first purchase

Your first land purchase will not attract any penalties unless it’s a high-value block of land.

You see, so many potential small investors shy off from buying these properties because of the land rates involved.

And I don’t think that should be the case.


Rules on Land Rates differ from one state to the other

Every state has its specific rules on how and when you can remit land rates. But generally, the rates will only come into effect after you’ve reached a particular land value threshold.

For instance, in Queensland, rates become effective on properties purchased under a trust. There isn’t any threshold for purchasing land under trust in NSW though. 

So you can see there are land tax loopholes. You only need to take advantage of each of them and avoid paying the rates sometimes.


Cast your portfolio net, far and wide

It is actually a brilliant idea to diversify your investments across different states. Nonetheless, it would be foolhardy to do so just because you want to avoid paying land rates.

The idea is to put down a solid strategy first.

And as Nathan narrates, he purchased many investment properties in various states because he’d seen the great potential. Further, he was able to strike super deals that have opened more doors for him.

For him, it wasn’t about saving money on tax.


Would you rather Apartments or Houses?

Many people don’t realize that you can buy several apartments and still operate below the land tax threshold. 

But how, you, may ask?

Most of these apartments contain just a smaller portion of land under the title.

Let’s say you bought a few apartments in Sydney 10 years ago. By now, you would be paying land rates. 

The same isn’t true if you had bought several apartments in Sydney. 


Land tax is part of the Business cost you must be ready to meet

Any type of business will require you to part with some costs. There isn’t a two way about it.

Honestly, why would you decline to buy an apartment that could fetch you more than $200,000 in three years because you fear to part with some few dollars in terms of land tax?

Nathan admits that he pays hundreds of thousands each year towards land tax. But then, that is how the system operates. 

However, he reveals that he’s bought more properties that he’s able to make more in profit and passive income.


Work with a good accountant

A knowledgeable and experienced accountant will help you minimize your overall taxation costs by applying for the different rules and exemptions on tax.


We pay tax on almost everything

Doing business and paying taxes are like siamese twins. The best thing to do is to pay your tax religiously but invest in properties that will fetch you massive profits.

Do you pay insanely high amounts of land tax each year? Call BOA & Co. accountants in Chatswood on 02 9904 7886 and our specialists will be pleased to assist you.

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