COVID-19 | Reminder to Landlords: 2020 land tax relief applications close soon

This article is issued as a timely reminder to Landlords who intend to seek COVID-19 land tax relief for the 2020 land tax year. Applications for relief in New South Wales and Victoria must be lodged prior to 31 March 2021.

In this update, we summarise the application process, eligibility criteria and evidentiary requirements for such relief in New South Wales and Victoria.

New South Wales

In New South Wales land tax relief is available by way of concessions for two periods in the 2020 land tax year. The first round of concessions apply to the six month period from April to September 2020, and a further round applies during a three month period from October to December 2020 (known as the ‘Concession Periods’).

Eligibility

Applications are lodged online via the Service NSW portal by Landlords who, in 2020:

1. 1. leased their property to commercial tenants with an annual turnover of less than $50 million and who had a minimum 30% reduction in turnover as a result of COVID-19 (Affected Tenants);
   2. provided rental relief by way of a waiver (rather than a deferral) to Affected Tenants during one or both of the Concession Periods; and
   3. have a 2020 land tax liability that can be attributed to the parcel of land where the rent reduction has been given.

Evidentiary requirements

All applications in New South Wales must include:

1. 1. details of the subject property and Landlord (including the client ID, and land tax correspondence ID);
   2. evidence of the rental reduction offered to the Affected Tenant (including any written agreement); and
   3. evidence of the Affected Tenant’s financial distress (such as a tenant statement explaining how they have been impacted by COVID-19).

Where eligible Landlords meet the above criteria and evidentiary requirements, the concession offered to the Landlord will be the lesser of the amount of rent waiver provided in the Concession Periods or 25% of the land tax attributable to that parcel of land. Refunds will be issued for payments already made this year.

Victoria

In Victoria, applications to the State Revenue Office are lodged online by Landlords who, in 2020:

1. 1. leased their property to:
      1. commercial tenants (includes retail, office and industrial) with an annual turnover of less than $50 million and who participated in the Australian Government JobKeeper payment scheme; or
      2. commercial tenants operating a licensed pub, club or restaurant under a general, full club or on-premises liquor licence with an annual turnover of less than $50milion, and who had a minimum 30% reduction in turnover, (Impacted Tenants); and

1. 2. provided rental relief by way of a waiver (rather than a deferral) to an Impacted Tenant between 29 March 2020 and 31 December 2020 for the value of at least 25% of the proportional land tax for the property.

Applications may also be submitted by Landlords who had executed lease agreements in place for March 2020, but the tenant could not fulfil those obligations and it resulted in the property being vacant for at least three months (continuously).

Evidentiary requirements

All applications in Victoria must include:

1. 1. a copy of the lease or occupancy agreement with the tenant;
   2. written evidence of the rental reduction offered to the Impacted Tenant (including any written agreement); and
   3. a commercial tenant details SmartForm from the tenant.

Where eligible Landlords meet the above criteria and evidentiary requirements, land tax relief of up to 50% may be available to the Landlord. Landlords may also seek a deferment of the remaining land tax liability until 31 March 2021.

2021 Land Tax Relief Applications

Applications for 2021 land tax relief close for New South Wales landlords on 30 April 2021, and Victorian landlords on 30 June 2021.

Please contact our team if you require any assistance with your application or require further advice on anything discussed above.

For details of all our COVID-19 tips and updates, visit the Gadens COVID-19 Hub.

Authored by:

Archie Smith, Partner
Janine Santamaria, Senior Associate
Elise Holland, Associate