Big stamp duty and tax changes for Victoria investors and businesses.

 

There are three main areas of significant change:

  1. Transition from stamp duty to annual property tax for commercial and industrial property. This will apply to commercial and industrial properties acquired on or after 1 July 2024. (existing owners of properties purchased before 1 July 2024 will not be affected). 

Once a property enters the new system the annual property tax will be payable at a flat 1% of the property’s unimproved land value.stamp duty will never again be payable on a transaction relating to that property.

  1. Covid Levy

The Victorian Government has announced a 'COVID Debt Repayment Plan' which is projected to assist in paying down $31.5 billion of COVID debt over the next 10 years.(Overall Victorian debt is around $161 billion). This plan includes the following tax increases which are expected to apply for a period of 10 years:

From 1 July 2023

An increase in the payroll tax rate by 0.5% for businesses with national payrolls over $10 million, plus an additional 0.5% for businesses with national payrolls over $100 million.

From 1 January 2024

An increase to land tax rates by 0.1% for owners holding land with a taxable value over $300,000 (if the land is not held in a trust) or $250,000 (generally if the land is held in a trust). There are also proposed additional fixed charges (of $500 for landholdings with a taxable value between $50,000 and $100,000 and $975 for landholdings with a taxable value above $100,000) and a decrease in the tax-free threshold for general (non-trust) land tax rates (from $300,000 to $50,000) which will result in significantly higher land tax assessments for investors with relatively low value landholdings (e.g. individuals and SMSFs). This also means some investors who previously paid no land tax will begin paying land tax for the first time.

  1. Doubling of absentee owner land tax surcharge rate.

With effect from the 2024 land tax year (i.e. having regard to properties owned as at midnight on 31 December 2023), the Government proposes to increase the absentee owner surcharge land tax rate (AOS) from 2% to 4%.

 

 

 

More Articles

TRANSITIONING INTO RETIREMENT: WHAT YOU SHOULD KNOW

Deciding on your retirement funding options comes down to personal choice. . If you’re close to...

Read full article

The Deadliest pandemics in History

Check out the Deadliest pandemics in...

Read full article

Middle-to-higher incomes boosting SMSF growth

The SMSF sector experienced healthy growth over the March quarter, with men and women on middle-to-higher...

Read full article

The superannuation changes from 1 July

The super changes on the way from the start of the 2024-25 financial year. . A number of...

Read full article

Investment and economic outlook, May 2024

Region-by-region economic outlook and latest forecasts for investment returns. . For the last...

Read full article

Downsizer contributions can be time critical

With the expansion of the downsizer contribution, the timing of when it is used can affect how to use...

Read full article

Deeming freeze a win for Age Pensioners

Why the decision to keep deeming rates on hold may be a window for interest rates.   . In...

Read full article

Plan now to take advantage of stage 3 tax cuts

With the stage three tax cuts set to be implemented in around six weeks, opportunities for tax-saving...

Read full article

Sofie Korac is an Authorised Representative (No. 400164) of Prudentia Financial Planning Pty Ltd, AFSL 544118 and a member of the Association of Financial Advisers.

Financial Advice Sydney and the North Shore Office based in Gordon NSW

Financial Services Guide - Disclaimer & Privacy Policy

^