Tax changes that Queensland landlords need to be aware of

Many landlords are not aware of the imminent changes to land tax coming in 2023. Code Property Group explains what you need to know so that you can be prepared.

There are significant tax code changes on the horizon for Queensland investors. These alterations will see investors charged with land tax based on the value of their whole Australian portfolio regardless of where their properties are located. This could come as a shock to those who have previously been exempt from certain taxes and will have broad implications across the real estate industry.

Under the new tax legislation, Queensland investors will be required to report any properties that they own outside of Queensland when doing their state taxes. Coming into effect in 2023, landlords will be charged land tax based on the complete value of their portfolio, nation-wide.

In theory, this means that a Queensland landowner with a taxable value of $745,000 and a property in New South Wales worth $1.565 million would have previously paid $1,950 in land tax in Queensland. Following the updated land tax rules, that tax bill will increase to $8,400 – based on the total value of the properties.

For properties valued under $600,000, Queensland currently has a land tax exemption which will still apply under the new aggregation rules. However, property owners who paid no tax on a property worth $599,999 last year but own other properties out of state, will now see their tax bills change dramatically. This is due to the aggregation changes, making it mandatory to pay land tax payable in Queensland despite both properties falling under the respective state land tax exemption thresholds because it will be calculated on the total value of the investor’s entire portfolio.

We are aware that this will come as a shock to investors who have never had a previous relationship with the land taxation office and will need to report and pay taxes under the new legislation, despite their portfolio circumstances remaining the same. Please know that our team are experts in real estate legislation and we are happy to help with any queries related to these upcoming changes.

Sources: REB & QLD Gov