Posted on March 05, 2024
VRLT may affect you with new changes coming into effect as of 1 January 2024.
VRLT is payable in addition to your normal land tax on a property. VRLT is also payable on a high value as your normal land tax is assessed on the site value of your property, however, VRLT is assessed on your capital improved value.
VRLT will be assessed on property regardless of its location in Victoria.
A property will be considered to be vacant if, for the land tax year, it has not be used or occupied for a period of 6 months, whether continuously or otherwise, by:
a. the owner as its principal place of residence;
b. the owner’s permitted occupant as its principal place of residence; or
c. a person under a lease or short-term leasing arrangement. However, this arrangement must be demonstrated that it is not created in order to avoid the tax.
If you are constructing a residence on land or renovating, the land will in some circumstances be considered to be vacant if the construction or renovation exceeds a 2 year period.
If a property is deemed to be vacant in the first year it will be taxed at the rate of 1% of its capital improved value. This will then increase to 2% on the second year and 3% for the third year and any years to follow.
Your holiday home could be exempt if it is occupied by the owner or a beneficiary of a trust for at least 4 weeks of the year and you also fulfil certain other criteria. Noting that no relief is available to property owned in the name of a company or discretionary trust at the present time however this may change in the future.
If you have any queries regarding how VRLT may affect you, please do not hesitate to contact Foula Markos, Senior Conveyancer at Scanlan Carroll.
Recent Articles
News Categories
