Land Tax Australia: Rates, Thresholds and How It Affects Property Investors (All States)
Land tax rates and thresholds for every Australian state and territory in 2026-27. NSW, VIC, QLD, SA, WA, TAS, ACT compared — with foreign surcharges, trust rules, and aggregation explained.
Land tax is an annual state-based tax on the unimproved value of land you own — not the buildings on it, and not the total market value of the property. It's levied by your state or territory government, and the rates, thresholds, and rules vary significantly between states.
For property investors owning multiple properties, land tax is often the biggest ongoing tax cost they didn't factor into their original cashflow calculations. Victoria's threshold is just $50,000, which means almost every investor with a single Melbourne investment property pays it. NSW's threshold is over $1 million, meaning many NSW investors pay nothing. The difference is dramatic.
This guide covers every state and territory, the aggregation rules that catch multi-property owners, foreign investor surcharges, and strategies to manage your liability.
Use our Land Tax Calculator to estimate your annual land tax bill across all your Australian properties.
What is land tax and how is it calculated?
Land tax is calculated on the unimproved value of the land — the value of the block of land alone, with no buildings, improvements, or structures. This figure is set by the state's Valuer-General annually and may differ substantially from the market value of the property or what you paid for it.
Key points:
- Your principal place of residence is exempt in every state — land tax only applies to investment properties, holiday homes, and other non-exempt land
- Each state taxes only land in that state — Queensland and most other states do not aggregate interstate holdings (though some states previously did)
- Land values are typically reassessed annually by the state Valuer-General, meaning your land tax bill can change year to year even if you haven't bought or sold anything
- Land tax is not income tax deductible as a separate line item — but it is deductible as a rental property expense if the land is income-producing
State-by-state land tax rates and thresholds 2026-27
Important: Land tax thresholds and rates are set by state governments and change regularly. The figures below reflect 2025-26 and 2026-27 announcements as at June 2026. Always verify with the relevant state revenue office before making financial decisions.
New South Wales
| Land value (taxable) | Land tax payable |
|---|---|
| Under $1,075,000 | Nil |
| $1,075,001 – $6,571,000 | $100 + 1.6% of amount over $1,075,000 |
| Over $6,571,000 | $88,036 + 2% of amount over $6,571,000 |
- Assessment date: 31 December each year
- Foreign owner surcharge: 4% of total land value (applied to each parcel separately, not just the portion above the threshold)
- Principal residence: Exempt
- Holiday homes: Exempt if you qualify; otherwise taxable
- Special note: NSW aggregates all your taxable NSW land to determine which bracket you fall in. If you own three properties each worth $400,000 in land value, your combined $1.2M exceeds the threshold and you pay land tax — even though no single property does.
Revenue NSW: revenue.nsw.gov.au
Victoria
Victoria has the lowest threshold in Australia, which means most Melbourne investment property owners pay land tax from the moment they own a single investment property.
| Land value (taxable) | Land tax payable |
|---|---|
| Under $50,000 | Nil |
| $50,001 – $100,000 | $500 |
| $100,001 – $300,000 | $975 + 0.20% above $100,000 |
| $300,001 – $600,000 | $1,375 + 0.50% above $300,000 |
| $600,001 – $1,000,000 | $2,875 + 0.80% above $600,000 |
| $1,000,001 – $1,800,000 | $6,075 + 1.30% above $1,000,000 |
| $1,800,001 – $3,000,000 | $16,475 + 1.90% above $1,800,000 |
| Over $3,000,000 | $39,275 + 2.65% above $3,000,000 |
- Assessment date: 31 December each year
- Absentee owner surcharge: 4% of total taxable land value (for foreign nationals or Australians ordinarily resident overseas)
- Vacant residential land tax: Additional annual tax on properties in inner and middle Melbourne left vacant — currently 3% of capital improved value, rising to 6% for properties vacant 3+ years
- Trust surcharges: Trusts pay an additional 0.5% surcharge
State Revenue Office Victoria: sro.vic.gov.au
Queensland
Queensland recently changed its aggregation rules — it no longer includes interstate land when calculating your Queensland land tax threshold. QLD also has different thresholds depending on who owns the property.
| Ownership type | Tax-free threshold |
|---|---|
| Individuals | $600,000 |
| Companies, trusts, absentee investors | $350,000 |
| Land value above threshold | Rate for individuals |
|---|---|
| $600,001 – $1,000,000 | 1.0% |
| $1,000,001 – $3,000,000 | $4,000 + 1.65% above $1M |
| $3,000,001 – $5,000,000 | $37,000 + 1.25% above $3M |
| $5,000,001 – $10,000,000 | $62,000 + 1.75% above $5M |
| Over $10,000,000 | $149,500 + 2.75% above $10M |
- Assessment date: 30 June each year
- Foreign owner surcharge: 3% additional on land held by foreign persons
- Principal residence: Exempt
- Interstate land: Not aggregated with QLD land for threshold purposes (change from prior rules)
Queensland Revenue Office: qro.qld.gov.au
South Australia
| Land value (taxable) | Land tax payable |
|---|---|
| Under $833,000 | Nil |
| $833,001 – $1,098,000 | $0.50% above threshold |
| $1,098,001 – $1,591,000 | $1,325 + 1.00% above $1,098,000 |
| Over $1,591,000 | $6,255 + 2.40% above $1,591,000 |
- Assessment date: 30 June each year
- No foreign owner surcharge (unlike most other states)
- Trust surcharge: Trusts with multiple beneficiaries may have a different calculation
- Principal residence: Exempt
RevenueSA: revenue.sa.gov.au
Western Australia
| Land value (taxable) | Land tax payable |
|---|---|
| Under $300,000 | Nil |
| $300,001 – $420,000 | 0.25% above $300,000 |
| $420,001 – $1,000,000 | $300 + 0.90% above $420,000 |
| $1,000,001 – $1,800,000 | $5,520 + 1.80% above $1,000,000 |
| $1,800,001 – $5,000,000 | $19,920 + 2.00% above $1,800,000 |
| $5,000,001 – $11,000,000 | $83,920 + 2.67% above $5,000,000 |
| Over $11,000,000 | $244,120 + 2.67% above $11,000,000 |
- Assessment date: 30 June each year
- No foreign owner surcharge on land tax (unlike most other states)
- Principal residence: Exempt
Department of Finance WA: wa.gov.au/land-tax
Tasmania
| Land value (taxable) | Land tax payable |
|---|---|
| Under $125,000 | Nil |
| $125,001 – $500,000 | 0.55% above $125,000 |
| Over $500,000 | $2,062.50 + 1.50% above $500,000 |
- Assessment date: 1 July each year
- Foreign owner surcharge: 2% additional
- Principal residence: Exempt
State Revenue Office Tasmania: sro.tas.gov.au
Australian Capital Territory
The ACT operates differently — instead of land tax, residential investors pay general rates that serve a similar function. There is no separate "land tax" on investment properties; rates apply to all properties including owner-occupied, but investment properties may attract a higher rate.
- Rate: Approximately 0.54% to 1.14% of unimproved land value, paid quarterly
- No separate land tax as such — the general rates system incorporates it
- Foreign owner surcharge: 0.75% additional on investment properties
ACT Revenue Office: revenue.act.gov.au
Northern Territory
The NT has no land tax. This makes the NT an outlier among Australian jurisdictions and is sometimes cited as a reason for investor interest in Darwin and surrounds.
The aggregation rule: why multi-property investors pay more
Every state aggregates all your taxable land in that state to determine your total land value for threshold purposes. You don't get a separate tax-free threshold for each property.
Example — Victoria:
- Investment property 1: land value $350,000
- Investment property 2: land value $280,000
- Combined taxable land value: $630,000
Land tax = $2,875 + 0.80% × ($630,000 − $600,000) = $2,875 + $240 = $3,115/year
If you had assessed each property separately, neither would cross the $600,000 bracket — you'd pay $2,875 on the combined amount. But the aggregation still pushes the total into a higher bracket than either property alone.
The aggregation rule is why investors who start with one or two properties and then buy more often see their land tax bill jump significantly with each additional purchase.
Trusts and companies: different rules apply
Land held in a discretionary trust or company often faces lower thresholds and higher rates than individually held land. This is an intentional policy to discourage using trusts and companies to split land holdings and reduce tax.
| State | Trust/company threshold | Surcharge vs individual rate |
|---|---|---|
| Victoria | Same threshold ($50k), but +0.5% surcharge | Higher effective rate |
| Queensland | Lower threshold ($350k vs $600k for individuals) | No additional rate, but threshold disadvantage |
| NSW | Same threshold, but specific trust rules apply | No separate surcharge (trusts taxed as individuals generally) |
| SA | Lower trust threshold in some cases | Varies |
If you're considering purchasing investment property through a trust for asset protection or succession planning reasons, factor in the land tax implications — the threshold disadvantage can cost thousands per year depending on the state.
Foreign investor surcharges
Most states charge foreign investors an additional land tax surcharge on top of the standard rate:
| State | Foreign owner surcharge |
|---|---|
| NSW | 4% of total land value |
| Victoria | 4% of total taxable land value (absentee owner) |
| Queensland | 3% |
| Tasmania | 2% |
| ACT | 0.75% |
| SA | None |
| WA | None |
| NT | No land tax |
These surcharges apply to the total taxable land value, not just the portion above the standard threshold. A foreign investor with $800,000 in Victorian land value pays 4% × $800,000 = $32,000 in absentee surcharge on top of the standard rate.
Practical strategies to manage land tax
1. Hold properties in different states Since each state aggregates only its own land, holding properties across NSW, QLD, and VIC gives you a separate threshold in each jurisdiction. An investor with $1M of land in each of three states pays less than one with $3M in a single state.
2. Understand your main residence exemption Your primary home is exempt in every state. If you're considering which property to live in among investment properties you own, choosing the highest land-value property as your main residence reduces your total assessable land base most effectively.
3. Check the assessment date Different states assess land tax on different dates (NSW and VIC: 31 December; QLD, SA, WA, TAS: 30 June). If you're buying property close to the assessment date, settlement timing can mean the difference between one year of land tax and two.
4. Factor it into cashflow modelling Land tax is deductible against rental income if the property is income-producing — it reduces the net rental loss (or increases net profit). Many investors do their initial cashflow calculations without land tax, then are surprised when the bill arrives. Include it from year one.
5. Review the Valuer-General's assessment If you believe the assessed land value is too high, you can object to the Valuer-General's determination within the state's review period. An incorrect land value affects both land tax and other levies — it's worth checking if you've recently purchased or if values in your area seem misaligned.
Frequently asked questions
What is land tax in Australia?
Land tax is an annual state-based tax on the unimproved value of land you own — the value of the block alone, excluding buildings and improvements. It applies to investment properties, commercial land, and vacant land, but not your principal place of residence. Each state sets its own rates, thresholds, and assessment dates. The Northern Territory has no land tax.
Is land tax deductible in Australia?
Yes — land tax is deductible as a rental property expense for income-producing investment properties. It reduces your net rental income (or increases your rental loss) and therefore reduces your taxable income. It is not immediately deductible for vacant land with no income, and not deductible at all for your principal residence.
Why does Victoria have such a low land tax threshold?
Victoria's $50,000 threshold is the lowest of any state and is an intentional policy choice. It means almost every Victorian investment property owner pays land tax. The rate is relatively modest at lower land values but escalates significantly for larger portfolios. The low threshold helps the Victorian government capture land tax revenue across a broader base of property investors.
How is land value different from property value?
Land value (also called unimproved land value or site value) is the value of the land itself — without the house, building, or any improvements on it. It's assessed by the state's Valuer-General and is typically significantly lower than the market value of the property. For a $900,000 house in a suburban area, the unimproved land value might be $400,000–$600,000 depending on the land size and location.
Do I pay land tax if I own property in multiple states?
Each state taxes only land within its own borders — so you get a separate threshold in each state. If you own $900,000 of land in NSW (under the $1,075,000 threshold) and $400,000 of land in VIC (above the $50,000 threshold), you pay no NSW land tax but do pay Victorian land tax on the Victorian property. Interstate holdings do not aggregate.
Do trusts pay land tax differently?
In most states, yes — discretionary trusts often have lower thresholds or pay surcharges compared to individual investors. In Victoria, trusts pay an additional 0.5% surcharge on top of the standard rate. In Queensland, trusts and companies face a $350,000 threshold rather than the $600,000 individual threshold. Always check the trust-specific rules in each state before purchasing investment property through a trust structure.
Land tax thresholds and rates are set by each state government and are subject to annual review. The figures in this article are based on announcements and available data as at June 2026. Verify current rates with the relevant state revenue office before making financial decisions. This article is for general information only and does not constitute financial, tax or legal advice.
Written by
Mahi PatilSoftware engineer & personal finance enthusiast · Melbourne, Australia
Built Dolaro.com.au to create accurate, free Australian finance tools. Invests in Australian and global ETFs and writes about the topics researched firsthand. More about Mahi →