If you own land in New South Wales and the value is above the land tax threshold, you may have to pay land tax unless you are exempt.
One main exemption is called the Principal Place of Residence (‘PPR’) exemption. Each family can only claim the PPR exemption for one property and the land should generally be used for residential purposes.
You need to continuously use and occupy the land as your PPR from 1 July to 31 December before the relevant tax year. In the case of joint owners, then at least one person needs to satisfy the requirement. The question of whether the land was continuously used and occupied is assessed objectively. That means, although your intention to live in the property is relevant, it will be considered against the actual number of nights you spent living in the property.
For people who spend a lot of their time overseas for work or other reasons, it is likely that if you spend more time in the overseas property then the Australian property will not be considered to be your PPR. You might allow your family to use the property, but to claim the exemption your family member should be a joint owner of the property.
There are many concessions for the requirement to use and occupy the land as your PPR. For example, if you live in your property continuously for at least six months and then leave, you can claim the PPR exemption for up to six years. However if you own or occupy another place of residence in those six years, then the concession will not apply.
If you disagree with the land tax assessment, you may submit an objection to the Chief Commissioner of State Revenue. There are also options for further review.
Disclaimer: This publication is general information only and does not purport to provide legal advice. We do not accept responsibility for any losses for reliance upon this publication.