The State Taxation Acts Amendment Act 2025 (the Act) received Royal Assent on 24 June 2025.
The Act implements a 2025–26 Victorian Budget measure and makes various changes to taxation laws.
2025–26 Budget measure
Extension of the temporary off-the-plan duty concession
The Duties Act 2000 is amended to extend the eligibility period for the temporary off-the-plan land transfer duty concession for purchases of eligible apartments and townhouses for a further 12 months to 21 October 2026. The concession reduces the amount of duty payable by allowing purchasers to exclude construction costs incurred on or after the contract date from the dutiable value of land.
This measure supports the 2025-26 Budget investment of $61 million to reduce land transfer duty for off-the-plan apartments, units and townhouses for another 12 months.
Other amendments
Family violence tax relief measures
The Duties Act 2000, First Home Owner Grant and Home Buyer Schemes Act 2000 and Land Tax Act 2005 has been amended to enable victim-survivors of family violence to access certain tax relief measures. To assist those affected by family violence, the measures allow victim-survivors to:
- receive an exemption from land tax for up to 6 years where the person has left their principal place of residence (PPR) due to family violence and the person has not received income from the land
- requalify for first home buyer benefits including the first home owner grant on another purchase where they have left due to family violence and haven’t received, or will not receive, a financial benefit from the property.
These amendments will commence from the day after Royal Assent.
Build-to-Rent (BTR) provisions
The Land Tax Act 2005 has been amended to ensure that BTR developments eligible for BTR tax benefits promote long-term rental options.
From 1 January 2026, the Act amends the Land Tax Act 2005 to:
- clarify that a minimum 3-year rental lease must be genuinely offered to a renter in a BTR development
- require the BTR provider and renter to jointly sign a declaration that a long-term rental option was offered but a lesser term was entered into at the request of the tenant. This declaration must be provided to the Commissioner upon request
- Allow a minimum lease term to be prescribed in regulations.
The Land Tax Act 2005 is also amended to give the Commissioner the power to disregard periods where a property eligible for BTR benefits is temporarily uninhabitable, when determining whether developments remain eligible. This amendment commences from the day after Royal Assent.
Commercial and Industrial Property Tax Reform (CIPT)
The Commercial and Industrial Property Tax Reform Act 2024 has been amended to enable the Commissioner to provisionally determine whether a property has a ‘qualifying use’ where no Australian Valuation Property Classification Code has been allocated to the land.
This change enables relevant land to transition from land transfer duty to annual land tax for commercial and industrial properties. This amendment commences retrospectively from 1 July 2024, when the CIPT reform commenced, to ensure property transacted from 1 July 2024 can enter the CIPT reform as necessary.
The Commercial and Industrial Property Tax Reform Act 2024 is also amended to ensure the duty payable on a property after subdivision (child lot) aligns with the treatment of the property before subdivision (parent lot). This amendment commences from the day after Royal Assent.
Land tax amendments
The Land Tax Act 2005 is amended to:
- allow a PPR exemption to partially apply to land when the owner is unable to live independently or passes away, despite the land being used to derive income from a substantial business activity or a separately rented residence
- extend the initial period of the section 58 exemption for PPRs on land unfit for occupation after an event such as a fire or flood to 4 years, allowing the exemption to be available for a maximum of 6 years.
From 1 January 2026, the Land Tax Act 2005 is also amended to streamline certain notification obligations imposed on trustees in relation to the disposal or acquisition of land. These changes clarify that trustees are required to notify the Commissioner:
- where a trustee holds land for one trust, and the land is transferred to a different trust to be held by that same person as trustee
- where a trustee disposes of land directly to themselves to be held in any capacity other than as trustee.
Payroll tax
From 1 July 2025, the Payroll Tax Act 2007 is amended to clarify the definition of ‘regional employee’. The amendment clarifies that only services performed in Victoria will be taken into account when determining whether a person is a regional employee.
Revenue Ruling PTA-042v2 Application of regional rate has been published to reflect the new regional employee definition and explain the requirements under the new definition. PTA-042v2 takes effect from 1 July 2025.
Taxation Administration Act
The Taxation Administration Act 1997 is amended to introduce a new base penalty tax rate of 50% for tax and notification defaults due to the recklessness of the taxpayer or someone acting on the taxpayer’s behalf. The new penalty rate will apply to tax defaults and notification defaults occurring from the day after Royal Assent.
Unclaimed Money Act 2008
The Unclaimed Money Act 2008 is amended to empower the Registrar of Unclaimed Money to recover unclaimed money which has been paid to a person who is not the owner, by issuing a notice of repayment; and empower the Registrar to pay an amount of unclaimed money to a subsequent genuine claimant, even if the entitlement has already been paid to an earlier claimant. These amendments commence from the day after Royal Assent.
Trust for Nature
The Victorian Conservation Trust Act 1972 is amended to expand the Vacant Land Conservation Covenant Account (VLCCA) criteria to allow funds to be allocated to a broader range of conservation covenants across Victoria. The expanded criteria of the VLCCA will enable funds in the VLCCA to be used in relation to land that contains a dwelling, land that has been zoned for non-residential purposes, or land in Victoria that is outside metropolitan Melbourne. This amendment commences from the day after Royal Assent.
