Absentee corporations

Key information

If you are an absentee owner, an absentee owner surcharge applies to your land tax. 

An absentee owner includes an absentee corporation.  

An absentee corporation is a corporation: 

• incorporated outside Australia, or 
• in which an absentee person has an absentee controlling interest. 

Absentee controlling interest

An absentee person has an absentee controlling interest if – either alone or with another absentee person – they: 

• hold more than 50% of the corporation’s shares 
• can control how the corporation’s board is composed 
• can cast more than 50% of the maximum number of votes at the corporation’s general meeting. 

The absentee person with a controlling interest can be an absentee corporation, a trustee of an absentee trust or an absentee individual. 

To work out if one or more absentee persons have a controlling interest in a corporation, you must look at all absentee persons who can exercise a controlling interest over the corporation.

Controlling interest exemption

An absentee person who holds a controlling interest in an absentee corporation may be eligible for an exemption such that they are taken not to hold an absentee controlling interest. If exemptions have been granted to all absentee persons who hold an absentee controlling interest, the absentee owner surcharge will not apply to the corporation. 

The exemption may apply to corporations: 

• which conduct a commercial operation in Australia 
• whose commercial activities make a strong and positive contribution to the Victorian economy and community by using local labour, materials and services through an Australian-based entity 
• which exhibit good corporate behaviour with a history of compliance with Australian laws. 

The exemption does not apply to absentee corporations incorporated outside of Australia, or those with businesses like a landlord or property investor. 

The Treasurer’s guidelines, published in the Government Gazette, explain how exemption decisions are made.  

Before you apply, refer to the Treasurer’s guidelines issued on 1 October 2018 for the 2019 land tax year onwards. These guidelines include examples of how build-to-rent developments may qualify. The exemption ends when the development is completed, as the absentee owner will then be considered a passive investor or landlord. 

Land tax groups

Absentee corporations may be part of a land tax group.  

If all members of a land tax group are absentee corporations, the absentee owner surcharge applies to all land held by the members of the land tax group. 

If only some members of a land tax group are absentee corporations, the absentee owner surcharge only applies to the land held by the absentee corporations. 

All members of a land tax group are jointly liable for land tax owed by the group. That means we can recover land tax – including the surcharge – from any member of the group. 

Notify us

If you are an absentee corporation that owns taxable land on 31 December, you must notify us by 15 January of the following year. 

You can also tell us about any change to your absentee owner status by updating your details in our absentee owner notification portal.