Reminder: State Revenue Office Vacant And Absentee Notifications Due By 15 January 2019

By Evelyn Marcou, Senior Associate, MST Lawyers

1 January 2018 saw the introduction of a residential land tax to homes in inner and middle Melbourne that were vacant for more than six months in the preceding calendar year.

 Vacant Residential Land Tax

 1 January 2018 saw the introduction of a residential land tax to homes in inner and middle Melbourne that were vacant for more than six months in the preceding calendar year. This tax is different to land tax, the absentee owner surcharge and federal annual vacancy fee. 

The vacant residential land tax is assessed by calendar year (1 January to 31 December) and the six months do not need to be continuous. If you own property in one of the 16 council areas being Banyule, Bayside, Borooondara, Darebin, Glen Eira, Hobsons Bay, Manningham, Maribyrnong, Melbourne, Monash, Moonee Valley, Moreland, Port Phillip, Stonnington, Whitehorse or Yarra, that was unoccupied or 6 months or more in 2018, you must notify the State Revenue Office via the vacant residential land tax portal.

Homes that are exempt from land tax are also exempt from vacant residential land tax.  Furthermore, homes that are unoccupied for more than six months of the preceding calendar year may be exempt from the tax if:

  • Ownership of the property changed during that year.
  • The property became a ‘residential’ property during that year.
  • The property was used as a holiday home and occupied by the owner for at least four weeks of that year (homes owned by companies, associations or organisations are generally not eligible for this exemption).
  • The property was occupied by the owner for at least 140 days of that year for the purpose of attending their workplace (homes owned by companies, associations or organisations are generally not eligible for this exemption).

Absentee Owner Surcharge

 An absentee owner surcharge of 1.5%  has applied from 1 January 2017 to Victorian land owned by the absentee owner

There are up to four steps to determine whether an individual is an absentee person:

  • Step 1: Is the individual an Australian citizen or permanent resident?

            If yes, the individual is not an absentee person. If no, go to step 2.

  • Step 2: Does the individual ordinarily reside in Australia?  

            If yes, the individual is not an absentee person. If no, go to step 3.

  • Step 3: Was the individual absent from Australia on 31 December?

            If yes, the individual is an absentee person. If no, go to step 4.

  • Step 4: Was the individual absent from Australia for more than six months in total during the year prior to the tax year?

            If yes, the individual is an absentee person. If no, the individual is not an absentee person.

The absentee owner surcharge is an additional amount that applies over the land tax you pay at general and trust surcharge rates. An absentee owner surcharge applies to Victorian land owned by an absentee individual, corporation or trust. If you are an absentee owner, you must notify us via our absentee owner notification portal.

The Government introduced these taxes to help address the lack of housing supply in Victoria.

 Due Date for Notifications

These notifications are due by 15 January 2019. If you made a notification last year, you only need to make a new one if your circumstances have changed.

If you require any assistance in determining whether either the vacant residential land tax or absentee owner surcharge applies, please contact Evelyn Marcou by email or call +61 3 8540 0200.