Regional commercial, industrial and extractive industries property concession
A duty concession is available if you buy property in regional Victoria used for commercial, industrial or extractive industry purposes where the contract is entered into on or after 1 July 2019.
This includes property currently being used for these purposes, as well as property converted to one of these uses.
For transactions entered into on or after 1 July 2019 and before 1 July 2020, the concession is a 10 per cent reduction in duty payable at general rates.
This concession will then increase by 10 per cent each financial year until a 50 per cent reduction applies to contracts and arrangements entered into on or after 1 July 2023.
|Contracts entered into on or after||Duty concession amount (%)|
|1 July 2019 and before 1 July 2020||10|
|1 July 2020 and before 1 July 2021||20|
|1 July 2021 and before 1 July 2022||30|
|1 July 2022 and before 1 July 2023||40|
|1 July 2023||50|
To receive the concession, the contract, agreement or arrangement must be for the transfer of dutiable property referred to in section 10(1)(a) and (ad) of the Duties Act 2000 (the Act). This includes:
- Buying land.
- Acquiring a life interest in land.
- Buying or acquiring a land use entitlement.
- Buying or acquiring an interest in fixtures separately from the underlying land on which the fixtures are located.
The dutiable property must be entirely located in regional Victoria and the transferee must intend to use it solely or primarily for a qualifying use.
Regional Victoria means the regional councils listed below and the six alpine resorts of Mt Baw Baw, Mt Buller, Mt Hotham, Mt Stirling, Falls Creek and Lake Mountain.
- Alpine Shire Council
- Ararat Rural City Council
- Ballarat City Council
- Bass Coast Shire Council
- Baw Baw Shire Council
- Benalla Rural City Council
- Buloke Shire Council
- Campaspe Shire Council
- Central Goldfields Shire Council
- Colac Otway Shire Council
- Corangamite Shire Council
- East Gippsland Shire Council
- Gannawarra Shire Council
- Glenelg Shire Council
- Golden Plains Shire Council
- Greater Bendigo City Council
- Greater Geelong City Council
- Greater Shepparton City Council
- Hepburn Shire Council
- Hindmarsh Shire Council
- Horsham Rural City Council
- Indigo Shire Council
- Latrobe City Council
- Loddon Shire Council
- Macedon Ranges Shire Council
- Mansfield Shire Council
- Mildura Rural City Council
- Mitchell Shire Council
- Moira Shire Council
- Moorabool Shire Council
- Mount Alexander Shire Council
- Moyne Shire Council
- Murrindindi Shire Council
- Northern Grampians Shire Council
- Pyrenees Shire Council
- Borough of Queenscliffe
- South Gippsland Shire Council
- Southern Grampians Shire Council
- Strathbogie Shire Council
- Surf Coast Shire Council
- Swan Hill Rural City Council
- Towong Shire Council
- Wangaratta Rural City Council
- Warrnambool City Council
- Wellington Shire Council
- West Wimmera Shire Council
- Wodonga City Council
- Yarriambiack Shire Council
The land must be used solely or primarily for a qualifying use for a continuous period of at least 12 months within two years of the transferee becoming entitled to possession.
This is normally settlement, but can be earlier by agreement.
Qualifying use means a land use described in codes 210-299 and 310-399, and 400-499 of the Australian Valuation Property Classification Code (AVPCC). These are uses falling in the commercial, industrial or extractive industries categories.
The commercial codes include retail and office spaces, and restaurants, while the industrial codes include factories, warehouses and processing facilities. Examples of extractive industries are mines, quarries, wells and bores.
Example 1: Vacant land becomes a medical centre
Dr Cini enters into a contract of sale in September 2019 to acquire a vacant commercial site in Bendigo with a dutiable value of $1,000,000. He intends to build a medical centre on the land.
The duty chargeable on the transfer of this property at general rates, including this concession, would be $49,500 (i.e. $55,000 reduced by 10%).
The contract settles in January 2020, and construction of the medical centre finishes in July 2020. In August 2020, Dr Cini moves in and starts running his medical practice. It is still operating from there in August 2021.
Dr Cini satisfies the use requirement because:
- A medical centre is a qualifying use because it has the AVPCC code 271.3.
- The land is used solely as a medical centre for a continuous period of at least 12 months within the two year period immediately after he became entitled to possession of the land.
Varying timeframes on the use requirement
If the Commissioner is satisfied that there is a good reason for failing to meet the use requirement within the specified timeframes, he can:
- Reduce the required period of qualifying use.
- Determine that a temporary cessation of qualifying use does not break the continuity of the qualifying use.
- Extend the period in which the qualifying use must begin.
An example of when the Commissioner may exercise this discretion is when a person buys a property intending to develop it for a qualifying use, but encounters planning challenges. The Commissioner may consider the purchaser’s timeline for development and whether any land development activity for a qualifying use has started, or will start, on the land.
Failing to meet the use requirement
You must lodge a written notice with the Commissioner within 30 days of becoming aware of any circumstances that may result in the qualifying use requirement not being met.
Once you have notified us, we will reassess duty on the transfer at the general rates, subject to any other exemption or concession applying.
What if I can receive another duty concession or exemption?
If, under the Duties Act 2000, you are entitled to this duty concession and another concession or an exemption, you must choose which benefit you are seeking to claim.
You must make this choice when complete the Digital Duties Form for this transaction.
Apply for this concession
You can easily apply for this concession using the Digital Duties Form at the time of lodging the transaction via Duties Online.
Submit the transaction as an electronic lodgement network operator (ELNO) complex transaction for duty assessment.