Am i eligible to claim land tax threshold in NSW? Please tell me I am.
Property owed by XXX Pty Ltd as Trustee for XXX Family Trust which myself and wife are the beneficiaries. On the State Revenue website, it defines the following.
A fixed trust is a trust where the beneficiaries are considered to be owners of the land at the taxing date of midnight on 31 December prior to the tax year. Land tax is calculated on the combined value of the taxable land owned above the land tax threshold.
A special trust is a trust where the trustee is the only person who meets the definition of ‘owner’ for land tax purposes and the beneficiaries are not considered to be owners. If a trust does not meet one of the previous trust definitions, it is a special trust. Examples of special trusts include most family trusts and discretionary trusts. The land tax threshold does not apply to special trusts which, in 2009, are taxed at a flat rate of 1.6 per cent for amount up to $2.25 million and 2.0 per cent there after.
So what am i? I certainly see myself A fixed trust. Where do you draw the line as the trust deed does not mention who owns the land.
My belief is that you have a discretionary trust and as such you will not be eligible for a tax threshold.
It used to be a unit trust still befitted from a threshold but I think that this has also changed. The Chan special property trust PIT was based on a unit trust and has since lost out to the dreaded landtax threshold.
Cheers