Hi All,
Yesterday, I got a letter from NSW SRO regarding land tax that I have to pay.
In NSW I’m only owned 2 IPs and start paying land tax already. If I am going to buy more IPs in NSW then there will be quite an amount of money for land tax each year.
Question: is there anyway that I can avoid or minimise land tax? Please help!
Ckev
Depending on the value of the property, it may be worth your while to set up a company/trust structure for each new property you purchase.
To All & Trueblue,
More info regarding Land Tax.
None improve value to be tax:
1st IP – $218k
2nd IP – $65kCurrent situation.
I live in my own home which mean exemption from land tax. But in the next few months I will be moving out and rent and turn my own home to IP. This will be more land tax.In this situation, will it be a good idea to set up company/trust for each IP or should I wait until I buy the next IP and then set up a company/trust structure for each new property I purchase?
Any thought and ideas will be appreciated in advanced.
Chandara
You have to do your sums on this one. As an indication, the costs of a shelf company is around $1,000. Trusts are about $200. Stamp duty on the trust in NSW I believe is $200. Then there’s your accountant’s fees.
After that, there’s annual filing fees for the company of $200 plus preparation costs by your accountant. Unless the stamp duty greatly exceed the holding costs of the company, you’re better off to stick to your current arrangement.
whoa!
does that mean when i m buying land in Victoria, there is land tax as well??????!!!
how much is it? counted at %??i bought this land at $102,000 which is due to settle next year.
Damn stupid government only wants money
!]Thanks Trueblue I am really appreciated
Chandara
$ $ $ $$ $ $ $
$ One problem solved! $
$ Next problem arrive! $
$ $ $ $$ $ $ $I have received my Land Tax Notices for 2003. There is no land tax payable in Victoria if your Total unimproved value of all your properties is less than $149,999.
The Unimproved Value is arrived at by the Site Value on your Council Rate Notice X an Index Factor. The Index Factor used to be a flat figure of 1.0. However it now seems to vary from Council to Council. Ballarat is 1.13, Wangaratta is 1.04, Frankston is 1.17, Latrobe is 1.02 to name a few. I have a complete list if anyone wants to know others.
It seems that the Vic. Govt. have increased the Index Factor to catch more people for land tax. []It will make no difference whether you have a company/trust structure. The Unimproved Value is what catches you out, particularly if you have multiple properties in one name, be it your name or a company.
The Land Tax Rates are:
0 – $149,999 Nil$150K – $199,999 $150 plus 0.1 cents for every $1 that exceeds $150K
$200K – $539,999 $200 plus 0.2 cents for every $1 that exceeds $200K
$540K – $674,999 $880 plus 0.5 cents for every $1 that exceeds $540K
$675K – $809,999 $1555 plus 1 cent for every $1 that exceeds $675K
$810K – $1,079,999 $2095 plus 1.75 cents for every $1 that exceeds $810K
$1.08m – $1,619,999 $7630 plus 2.75 cents for every $1 that exceeds $1.08m
$1.62m – $2.699,999 $22480 plus 3 cents for every $1 that exceeds $1.62m
$2.7m and over $54880 plus 5 cents for every $1 that exceeds $2.7m
[
!]Cheers
Nessie
!]
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