This video explains the how land tax is assessed where a person holds land with others, in addition to land held on their own. In this situation, there may be more than one assessment, but a joint ownership deduction is applied to avoid double taxation.
If you own land with others, you are a joint owner of land. Each unique combination of owners is considered a different joint ownership. Joint ownerships can include individuals, companies and trusts.
We assess joint owners for land tax in three stages.
First we assess each unique joint ownership on all the taxable land owned by that particular combination of owners.
If the joint ownership is liable for land tax, we will issue a joint ownership assessment. We will send the joint ownership assessment to one of the joint owners, on behalf of all the owners.
All the joint owners of the property are jointly liable for the land tax payable. If the joint ownership only owns exempt land, or if the land owned is below the land tax threshold, we will not issue a joint assessment.
Let’s look at an example.
Fred and Mary jointly own land with a total taxable value of $280,000. Land tax on the jointly owned land between Fred and Mary is $335 so they will receive a joint ownership assessment for $335. They are jointly liable for this amount.
In stage two, we assess each member of the joint ownership individually for all of their interests in taxable land. Your individual assessment lists all of the land you own. This includes any land you own by yourself, jointly with others, or as a notified or nominated beneficiary of certain trusts.
Let’s go back to our example.
Fred also owns another property by himself, valued at $200,000. Fred is assessed on his individual interest of land, plus his proportional share of the property he holds jointly with Mary. Fred’s total taxable value is $340,000 which attracts a land tax liability of $455.
If you are assessed for land tax under a joint ownership assessment, we will apply a joint ownership deduction to your individual assessment.
Your deduction is the lesser of either your share of the tax on the joint ownership assessment, or the amount of tax calculated on your individual assessment for your share in the jointly owned land. You can find the deduction amount on page two of your individual assessment.
Fred is entitled to a joint ownership deduction of $167.50 for the land tax that has already been assessed on the jointly owned land.
In summary, if you are a joint owner of land in Victoria: we assess you together with all joint owners, then, we assess you individually.
This means you may receive more than one assessment. If you are liable for land tax both jointly and individually, you will receive a joint ownership deduction.
More information about joint ownerships is available at sro.vic.gov.au/jointowners