Many homeowners are currently feeling the sting of the bearish turn the property market has taken, and the Victorian State Revenue Office (SRO) is rubbing salt in the wounds as it issues significantly increased land tax assessments.

Why has my land tax liability increased this year?

Land valuations will, from 2019, be undertaken annually by the Valuer-General, as opposed to the bi-annual review undertaken by the local council. The identified value of your land as at 1 January 2018 is reflected in your 2019 land tax assessment.

The taxable (Site Value) of land can increase as a result of the acquisition of additional property, the removal of an exemption that applied to the land, or the value of the land increasing.

Recently, there has been a notable increase in valuations of land (which flows on to your land tax assessments and council rates).

Can I object to my land tax assessment?

Yes, land tax assessments can be objected to on a number of basis. This includes:

  1. site or capital improved valuation;

  2. factor changes, for example removing land that you do not own or adding land you do own; or

  3. legal basis for the assessment, such as qualifying for the principal place of residence and primary production exemptions.

After receiving your land tax assessment, you have 60 days to lodge an objection. If you’re outside of the 60-day time-frame, you can make an application for an out of time objection (although the SRO does not have to accept it).

If your land tax assessment contains any incorrect data (e.g. wrong land included or exemptions that have not been applied) you should seek legal advice.

If your objection to a land tax assessment, including to the land Site Value (unimproved value) is successful, this should result in a lower land tax bill.

Should I object to the land Site Values?

If you would like to object to the land Site Values contained in your 2019 land tax assessment you will need to consider whether the values identified are reasonable.

Some initial factors to consider may include:

  1. seeking an independent market valuations or appraisal for the unimproved land as at 1 January 2018;

  2. considering historical council rates notices to compare the Capital Improved Value (CIV) and Site Values of your land as at 1 January 2018 (the valuation date for your 2019 assessment) and 1 January 2017 and seeing if the change in values is in line with the market movements. The Victorian Valuer-General’s website has resources, including a list of median house prices by suburb from 2007 to 2018; or

  3. comparing the sale price of similar properties in your local market that have been sold on or about 1 January 2018 and comparing this to the CIV and underlying Site Value identified for your land. An example of a free resource for this is www.oldlistings.com.au.

 How we can help

The process of objecting to your land tax assessment and/or land Site Values can be confusing and convoluted.

Our team will help you assess whether your land tax assessment is correct, assess whether you qualify for any exemptions, and understand what you need to do to lodge a valuation objection.

We can assist with managing a stressful objection process by:

  1. applying our experience in assisting clients with large and complicated land holdings to provide you with specific advice in respect of your matter;

  2. preparing objections and identifying the supporting documentation you should provide; and

  3. managing correspondence required with multiple government bodies (e.g., Valuer-General, Council, and Victorian State Revenue Office).

If you would like to discuss you land tax or any other state tax issue, please contact:

Rod Payne
Principal
T: 03 5226 8541
E: rpayne@ha.legal