Land Tax Threshold Strategies: How to Stay Below the Threshold
Land tax is assessed on the total taxable land value you own in each state. Understanding thresholds and ownership structures can help you minimise or avoid land tax — but each approach has trade-offs. Here's how the main strategies compare.
| Individual Ownership | Trust Ownership | Joint Tenancy | |
|---|---|---|---|
| Threshold (NSW) | $1,075,000 | $1,075,000 (same) | Proportional share |
| Threshold (VIC) | $50,000 | $25,000 (lower) | Proportional share |
| PPR exemption | Yes | No | Yes |
| Trust surcharge | N/A | VIC 0.375%, QLD 0.5% | N/A |
| Asset protection | Limited | Strong | Limited |
State-by-State Land Tax Thresholds
Each state sets its own tax-free threshold. Below this amount, no land tax is payable. Above it, tax is calculated on the amount over the threshold at progressive rates:
Higher Thresholds
- NSW: $1,075,000
- QLD: $600,000
- SA: $450,000
Lower Thresholds
- WA: $300,000
- VIC: $50,000
- TAS: $25,000
Key point: Your principal place of residence is exempt from land tax in all states. Only investment properties, vacant land, and commercial properties count towards your taxable land value.
Strategy 1: Spread Ownership Across Individuals
Each person has their own land tax threshold. By holding different properties in different names (e.g., one spouse owns Property A, the other owns Property B), each person's land value may stay below the threshold.
- Best for: Couples with multiple investment properties
- Limitation: Transferring existing properties triggers stamp duty and CGT
- Tip: Plan ownership structure before purchase, not after
- Watch out: Some states have aggregation rules for related parties
Strategy 2: Trust Ownership
A trust is a separate legal entity with its own land tax assessment. However, trusts face disadvantages in several states:
- Victoria: Lower threshold ($25,000) and 0.375% surcharge on total land value
- Queensland: 0.5% surcharge on total land value
- NSW: No surcharge — trusts are treated the same as individuals
- No PPR exemption: A property held in a trust cannot claim the principal place of residence exemption
Trusts can still make sense for asset protection and estate planning, but the land tax cost needs to be weighed against these benefits.
Strategy 3: Joint Tenancy
When two people own property as joint tenants or tenants in common, each person is generally assessed on their proportional share of the land value. This can reduce each person's land tax liability:
- 50/50 ownership: Each person is assessed on half the land value
- PPR exemption preserved: If one owner lives in the property
- Aggregation: Each person's share is aggregated with their other land holdings
Aggregation Rules to Watch
Land tax is calculated on the total value of all taxable land you own in a state, not per-property. This aggregation means:
- Buying a second investment property can push your total over the threshold
- Even small landholdings (vacant blocks, parking spaces) count
- Interstate properties are not aggregated — each state assesses separately
- Properties held in different entities (company, trust, individual) are assessed separately
Calculate your land tax liability
Use our land tax calculators to model different ownership scenarios and see the impact on your annual tax bill.
Open Land Tax CalculatorsFrequently Asked Questions
What are the land tax thresholds in each state?
Thresholds vary significantly. NSW: $1,075,000, Victoria: $50,000 (reduced from $300,000 in 2024), Queensland: $600,000, South Australia: $450,000, Western Australia: $300,000, Tasmania: $25,000. These are the tax-free thresholds below which no land tax is payable.
Does owning property in a trust affect the land tax threshold?
Yes. In Victoria, trusts have a lower threshold ($25,000 vs $50,000) and pay a surcharge of 0.375%. In NSW, trusts are treated the same as individuals for land tax. In Queensland, trusts attract a 0.5% surcharge. Trust ownership strategies should weigh land tax surcharges against asset protection and estate planning benefits.
Can I split properties between family members to stay below the threshold?
Each individual has their own land tax threshold based on properties they own. Holding properties in different names can mean each person stays below the threshold. However, stamp duty on transfers, CGT implications, and aggregation rules for related parties must be considered. This strategy works best when acquiring new properties.
Is my home subject to land tax?
No. Your principal place of residence (PPR) is exempt from land tax in all states and territories. This exemption only applies to one property per individual. Investment properties, holiday homes, and vacant land are not exempt.