Absentee Property Owner – Tax Whack – Victoria

The State of Victoria State Revenue Office (SRO) coffers must be bulging from land tax imposed on absentee owners.

       

As a simple illustration for land with a site value of $3m normal land tax would be $24,975 p.a. but if the owner is non-resident, tax is $84,975 p.a.

An absentee individual is any individual who:-

  • is not an Australian citizen or permanent resident
  • does not ordinarily reside in Australia, and
  • was absent from Australia
    • on 31 December of the year prior to the tax year, or
    • for more than six months in total in the calendar year prior to the tax year.

An absentee corporation is a corporation:

  • that is incorporated outside Australia, or
  • in which an absentee person(s) has a controlling interest.

An absentee trust can have at least one beneficiary who is an absentee person.

This 20% tax will significantly exceeds any rental income – great care is needed if potentially relevant. And the obligation is on the owner to advise SRO of their absentee status.

 

 

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