Government of Western Australia Department of Treasury and Finance Office of State Revenue 2009-10 Land tax Welcome to the 2009-10 land tax information brochure. This brochure has been prepared as a general guide to the Land Tax Assessment Act 2002. It is not intended to be a complete statement of the law and must not be construed to waive or modify any legal obligation in the Act. Please take time to read this brochure, as it provides important information to help answer the most commonly asked questions about your 2009-10 land tax assessment. You can also find the latest information and publications on our website at www.osr.wa.gov.au. 1. What’s new for 2009-10? • A 50% cap on the annual increase in land values will apply for the purpose of assessing land tax and metropolitan region improvement tax (MRIT). This is intended to reduce the volatility and unpredictability contents in individual land tax assessments from year to year. • The time for paying land tax in two instalments has been extended from 110 days to 175 days, and three instalments extended from 175 days to 240 days. In addition, the flat charge that is applied to the three instalment payment option has been reduced from 4% to 2%. 1. What’s new for 2009-10? • A concession for property developers to allow land tax and MRIT 2. What is taxable land? to be paid on the lower undeveloped (or ‘englobo’) value of the individual land (i.e. the value of the land prior to subdivision), 3. Who is liable to pay land tax? rather than the full subdivided value of lots, for one year after the creation of the lots. The application form and information fact 4. What is land tax and sheet for this concession are available on the website or by metropolitan region telephoning (08) 9262 1200. improvement tax? 5. Calculation of land tax 2. What is taxable land? and MRIT Taxable land is land you owned at 30 June 2009, excluding exempt land (see item 6 in this brochure). Examples of taxable land include: 6. Exemptions and concessions • vacant land; 7. What can I do if my • residences which are not used by the owners as their assessment is incorrect? primary residence; • ‘secondary’ residences such as holiday homes, holiday units or 8. Objections against an hobby farms; unimproved valuation • rental homes or units; of land • commercial properties including shops, offices and factories; 9. Anti-avoidance provisions • land held in trust or owned in a company name; 10. Your obligations • entitlement to land under any lease or licence from the Crown; • land used for business, commercial, professional or trade purposes 11. Contact details and under arrangements with the Crown, Crown instrumentalities, local payments authorities or public statutory bodies. 2009-10 Land tax 4. What is land tax and metropolitan region improvement tax? Land tax is an annual tax which is calculated on the aggregated taxable value of all land you owned (excluding exempt land) at midnight on 30 June before the year of assessment. This tax is a source of general revenue for the Government of Western Australia and assists in the funding of such services as education, health, law and order. Metropolitan region improvement tax (MRIT) is an annual tax calculated on the aggregated taxable value of land you owned (excluding exempt land) at midnight on 30 June, which is situated in the metropolitan region. The metropolitan region includes the following local 3. Who is liable to pay land tax? governments: Armadale, Bassendean, Bayswater, Belmont, If, at midnight 30 June 2009, you owned land (excluding Cambridge, Canning, Claremont, Cockburn, Cottesloe, East exempt land) with an aggregated taxable value in excess of Fremantle, Fremantle, Gosnells, Joondalup, Kalamunda, $300,000, you are required to pay land tax for the 2009-10 Kwinana, Melville, Mosman Park, Mundaring, Nedlands, assessment year. An ‘owner’ includes: Peppermint Grove, Perth, Rockingham, Serpentine- • a person who holds the freehold title to land; Jarrahdale, South Perth, Stirling, Subiaco, Swan, Victoria Park, Vincent and Wanneroo. This is a special purpose • a person who holds land in trust; tax used to finance the cost of providing land for roads, • a person who leases land from the Crown or local open spaces, parks and similar public facilities. government (lessee); • a person deemed to be the owner because he or she is in possession of the land and that possession is in 5. Calculation of land tax and MRIT accordance with the agreement for the sale of land Land tax and MRIT are calculated on the aggregated between vendor and purchaser. taxable value of all taxable property held in the same ownership (excluding exempt land) at midnight on NOTE: If you sell land after midnight 30 June 2009, you are 30 June. From 2009-10, increases in unimproved still responsible for land tax for the 2009-10 assessment year. valuations of land will be capped at 50% of previous year The Office of State Revenue does not apportion land tax and any adjustment of taxes is a private matter between the values for land tax and MRIT purposes. vendor and the purchaser. The unimproved value of land is its market value under normal sales conditions, assuming that no structural improvements have been made. Land within the Perth Metropolitan Region and townsites throughout Western Australia is assessed on the site value basis which includes merged improvements with examples including draining, filling, excavation, grading and retaining walls. Each year, the Valuer General determines the unimproved values of all land in the State. The unimproved value that applies to land for land tax and MRIT assessment purposes for the 2009-10 assessment year was determined by the Valuer General as at the date of valuation, being 1 August 2008. This means that in determining the unimproved values to be used for 2009-10 land tax assessments, the Valuer General was required to consider sales evidence falling within a time period around 1 August 2008 and not at the date of assessment for land tax, being 30 June 2009. Further information on unimproved valuations can be obtained by visiting the Landgate website at www.landgate.wa.gov.au. The amount of land tax payable is calculated by applying the appropriate rate of tax to the aggregated taxable value of taxable land in the same ownership. Map of metropolitan region for MRIT. For example, if you owned two taxable properties with taxable values of $200,000 and $300,000 respectively, the tax is assessed on $500,000 at the rate shown in the table below. Generally, only land owned by the same owners is aggregated. For example, land that is owned solely by you is not usually aggregated with land you own jointly with another person, or with land that you have an interest in through a company or trust. In such circumstances, a separate assessment notice may be issued. IMPORTANT: If all the land you owned under the same ownership as at 30 June 2009 is not shown on one assessment notice, you must advise the Office of State Revenue – (see item 10 in this brochure). Land Tax Rates for 2009-10 Aggregated taxable value of land Exceeding ($) Not exceeding ($) Rate of land tax 0 300,000 Nil 300,000 1,000,000 0.09 cent for each $1 in excess of $300,000 1,000,000 2,200,000 $630 + 0.47 cent for each $1 in excess of $1,000,000 2,200,000 5,500,000 $6,270 + 1.22 cents for each $1 in excess of $2,200,000 5,500,000 11,000,000 $46,530 + 1.46 cents for each $1 in excess of $5,500,000 11,000,000 $126,830 + 2.16 cents for each $1 in excess of $11,000,000 Metropolitan Region Improvement Tax Rate for 2009-10 Aggregated taxable value of land Exceeding ($) Not exceeding ($) Rate of metropolitan region improvement tax 0 300,000 Nil 300,000 0.14 cent for each $1 in excess of $300,000 If land is not subject to land tax, it will not be liable for MRIT. 6. Exemptions and concessions • Newly constructed/refurbished residential exemption for a second private residence (limited to two years). • Residential exemption – this exemption applies to the owner’s primary residence at 30 June 2009 This exemption applies for two consecutive assessment if the owner resides there and the land is used years where the owner occupies their primary residence solely or principally for residential purposes. while constructing or refurbishing a new primary residence. You can apply for this exemption if all of the following criteria NOTE: To apply for this exemption you can download the are met: section 21 - Application for Residential Exemption form available under Land Tax/Forms at www.osr.wa.gov.au – you own two residences, the first acquired being occupied as your primary residence and the second acquired (new) • Newly constructed or refurbished private residence is being constructed or refurbished. The new residences (limited to two years) residence must have been purchased between 1 July 2008 An exemption can be granted for two consecutive and 30 June 2009; assessment years for private residential property – you complete the sale of the first acquired residence and that has taken two or more years for construction deliver to the purchaser on or before 30 June 2011; or refurbishment to be completed. – you complete and occupy the second acquired newly You can apply for this exemption if all the following constructed or refurbished residence on or before criteria are met: 30 June 2011; – you commence/carry out construction or – while you owned both properties, you must not have refurbishment of the private residence in the derived any income from the property that was not being 2009-10 financial year; used as your primary residence. – you do not own any other private residential NOTE: To apply for this exemption you can download the section property that is exempt from land tax as your 27A - Application for Residential Exemption Moving from One Private primary residence; Residence to a Newly Constructed or Refurbished Residence form available under Land Tax/Forms at www.osr.wa.gov.au. For more – you occupy the property as your primary place information regarding this exemption please contact the land tax of residence on or before 30 June 2011. enquiry line on (08) 9262 1200. NOTE: To apply for these exemptions you can download the • Other exemptions and concessions may be available if the section 24/24A - Application for Residential Exemption for a Newly Constructed Private Residence or section 25/25A land is: - Application for Residential Exemption for a Refurbished – used for a rural business, such as farming; Private Residence forms available under Land Tax/Forms – owned by a trust/company and used by a disabled at www.osr.wa.gov.au. For more information regarding beneficiary; these exemptions please contact the land tax enquiry line on (08) 9262 1200. – owned by an individual and used by a disabled person related to the owner; • Two existing residences in transitional – owned by a religious body and used for religious circumstances - you may qualify for an exemption purposes; on two residences which are owned in transitional – owned by an educational institution and used for circumstances at 30 June 2009 if all the following educational purposes; criteria are met: – used for a public or religious hospital; Exemptions & – the new residence must have been purchased – owned by a public charitable or benevolent institution or a between 1 July 2008 and 30 June 2009; non-profit organisation and used for the purposes of that – you must have moved from your original organisation; residence to the new residence on or before – used as a retirement village; 30 June 2010; – used as an aged care facility; concessions – you must have delivered possession of the – used as a caravan park or camping ground; former residence to the purchaser on or before – held under an approved conservation covenant; 30 June 2010; – owned by a deceased estate; – while you owned both properties, you must not have derived any income from the property that – owned by a veteran’s surviving partner or mother; was not being used as your primary residence. – newly subdivided for residential purposes; – privately owned and occupied residential property in the NOTE: To apply for this exemption you can download the section 27 - Application for Exemption if Moving Inner City zone. from One Private Residence to another Private Partial exemptions and concessions are available where only Residence form available under Land Tax/Forms at www.osr.wa.gov.au. For more information regarding some of the owners use the land as their primary residence, or this exemption please contact the land tax enquiry line where the land is used for both exempt and non-exempt purposes, on (08) 9262 1200. such as residential and business/commercial purposes. 9. Anti-avoidance provisions , From 2006-07 sections 45A and 45B of the Land Tax Assessment Act 2002 enabled the Commissioner to make a determination that a minor (ownership) interest in a lot or parcel of land can be disregarded for the purposes of assessing land tax. At the time of issuing your assessment notice, the Commissioner may not have made a determination in accordance with these sections. However, this does not prevent a future determination, which may result in a reassessment being made and a new assessment notice being issued. You can find out further information by contacting (08) 9262 1380 or email email@example.com. 7. What can I do if my assessment is incorrect? Most queries regarding your assessment can be resolved 10. Your obligations by contacting (08) 9262 1500. However, if you wish to You must notify the Office of State Revenue before the due lodge an objection it must; date for payment shown on your assessment notice if: • any land you owned at 30 June 2009 has not been • be in writing with the word ‘OBJECTION’ clearly included on the assessment notice; written at the top of the letter; • you have received separate assessment notices for • state fully and in detail the grounds of your objection; land owned by the same person (all land in the same • be lodged within 60 days of the date of issue shown ownership must be included in one assessment for on your assessment notice. the purposes of aggregation); NOTE: For an objection against the unimproved • you delivered possession of the land to the purchaser valuation of land, see item 8 in this brochure. on or before midnight 30 June 2009; • some or all of the owners have commenced or resumed Lodgement of an objection does not affect the liability using assessed land as their primary residence on or for payment of your assessment by the due date. before midnight 30 June 2009; Send your objection to: • you have met the exemption criteria for a newly Commissioner of State Revenue constructed/refurbished residence or two residences Office of State Revenue, owned in transitional circumstances; GPO BOX T1600, • land that you own beneficially has been assessed Perth WA 6845 together with land you own as a trustee; • land that you own as trustee for a trust has been 8. Objections against an unimproved assessed together with land you own as trustee for a valuation of land different trust; • Before lodging an objection against a valuation you • any land that has been exempt was not used for the should contact the Valuer General on (08) 9429 8400, exempt purpose shown on the assessment notice; or as it may be possible to resolve your enquiry over • your assessment notice contains any other errors or the phone. omissions. • An objection against a valuation must be lodged within 60 days of the date of issue shown on your assessment notice, and must include the lot number, street address of the property, and the name of the local government authority. • You must also state fully the grounds of your objection, and provide a daytime contact number. • Please lodge your objection with Landgate – Valuation Services Branch, PO Box 7201 Cloisters Square, Perth WA 6850. Lodgement of an objection does not affect the liability for payment of your assessment by the due date. You may incur a penalty or be liable to prosecution if you fail to notify this office of any errors or omissions in your notice of assessment before the due date for payment. 11. Contact details and payments Email firstname.lastname@example.org Website www.osr.wa.gov.au Land tax assessment (08) 9262 1500 enquiries General land tax enquiries (08) 9262 1200 Country callers’ enquiries 1300 368 364 Change of postal address (08) 9262 1200 details Facsimile number (08) 9226 0837 200 St Georges Terrace, Perth In person (8.00am to 5.00pm Mon to Fri) Land tax payments can be made by Credit card www.osr.wa.gov.au/payments Telephone: 1300 133 676 Credit card payments are limited to $5,000 per assessment. VISA MASTERCARD Overseas and Interstate, please call (08) 9262 1500 Contact your participating bank or financial institution to arrange Bpay payment. Please quote the Biller Code 747097 and the reference number shown on your assessment notice. Please attach the land tax payment slip to your cheque, made payable to Mail ‘Commissioner of State Revenue’ GPO Box H572 Perth WA 6841 Payment at any Australia Post Office or Agency. In person www.osr.wa.gov.au The notes in this brochure have been prepared as a general guide to the Land Tax Assessment Act 2002. They are not intended to be a complete statement of the law and must not be construed to waive or modify any legal obligation in the Act.
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