Land Tax Relief and Tax Relief for Landlords During COVID 19


Given the impact of the coronavirus pandemic on businesses, landlords and tenants are both concerned regarding the payment of rent. In this regard, the Victorian government has provided land tax relief to eligible commercial and residential landlords who provided rent relief to tenants impacted by coronavirus, or who were unable to secure a tenant as a result of coronavirus. The relief is up to 50% waiver of the subject property’s 2020 land tax, and deferring payment of the remaining land tax to 31 March 2021.


25% Land Tax Relief

In order to qualify for the 25% tax relieflandlords for commercial and residential properties must provide eligible tenants[1] impacted by coronavirus with rent relief consistent with the principles of the Support to Landlords and Tenants package. This includes, if you have a tenant, a 6-month moratorium to not evict your tenant (for commercial properties, not evict them for non-payment of rent for small to medium enterprises with an annual turnover under $50 million and which experienced a loss of 30% or more in turnover as a result of the coronavirus) and offer to negotiate the rent.

In addition to the above, a tenant of a commercial property will also need to declare to the landlord that they fall within one of the two following categories:[2]

  1. Tenants operating a licensed pub, club or restaurant under a general, full club or on-premises liquor licence.
  2. Tenants of all other commercial businesses.

If you are an owner-occupier of your commercial property, you can obtain a 25% waiver of the property’s 2020 land tax if your business falls in either of the two categories referred to above.

50% Land Tax Relief

For both commercial and residential landlords, you may be eligible for a 50% land tax relief for that property for the 2020 land tax year if you have provided your tenant 50% or more rent waiver of at least 3 months’ rent.


Extension of 25% land tax relief to residential landlords and further deferral of land tax payment

The State Revenue Office recently announced that the 25% land tax relief for residential landlords will extend to the 2021 land tax year, and landlords can defer payment of the remainder of their 2020 and 2021 land tax assessment until 30 November 2021.

Interested in learning how Rockwell Bates can assist you in applying for the land tax relief or have a tax query, please do not hesitate to contact Joseph Santhosh or Yvonne Liaw in our Private Client team.

[1] This has been defined on the State Revenue Office website as including tenancy agreements, specialist disability accommodation agreements and site agreements. They have stated that holiday accommodations such as hotels, motels, bed and breakfast and rooming houses are not eligible for land tax relief.

[2] Please note that there are further requirements including the turnover of the business.