Land Tax Leaches

[pulse]

My Dad (in his seventies and retired) has just received a bill from Morris for $12000 in overdue land tax.

He always had his accounts professionally managed and was never informed of the need to register for land tax. The assesment has $3000 in penalties charged at $13.5%

His investment properties are 2 x 2br units in Mosman, no water views built on a steep hill with small blocks and about 6 floors of strata units. They are both first floor in identical adjacent buildings. The properties were most recently (? 2003) valued at just over $300000 by bank valuers.

The Land values were assessed as follows:

.................2003 OSR..........2004 OSR.....2005 Rates taxable land value
PropertyA..........168K..............251K.............160K
PropertyB..........207K..............310K.............197K

I have a 2Br unit in Randwick with extensive landscaped gardens valued at $470K with an OSR land valuation of just over 100K.

My question is... how can the land value be so close to the value of the whole property? Why the difference between two identical adjacent buildings with 2 very similar units on the same floor? Why the difference compared with a 2Br unit in Randwick??? Why the difference between the OSR valuation and that of the council??

Anyway, The best question is how they expect someone who is retired in their seventies to come up with that money if 4 weeks... not even enough time to sell and settle...

With love
Pissed off Pulse

 

[Glebe]

I don't really know how they come to the calculations, but if it's overdue then it's not really the government's fault that you dad only has 4 weeks to cough up...

 

[lizzie]

first simple answer is to ring and talk to them. i'm sure they don't bite. ask how they come up with their calc's. tell them about your father's situation ... and then go from there.

 

[rossv]

Hi pulse,

recently there has been a ruling from the ombudsmens office stating that

20% of vals for land tax were overvalued, so there may be hope.......

i suggest you start here:

http://www.lands.nsw.gov.au/Records/Valuation/objecting.htm

this article may be of interest

http://www.abc.net.au/news/newsitems/200510/s1474482.htm

good luck

rossv

 

[cloclo]

My question is... how can the land value be so close to the value of the whole property? Why the difference between two identical adjacent buildings with 2 very similar units on the same floor? Why the difference compared with a 2Br unit in Randwick??? Why the difference between the OSR valuation and that of the council??

Anyway, The best question is how they expect someone who is retired in their seventies to come up with that money if 4 weeks... not even enough time to sell and settle...

With love
Pissed off Pulse

[/QUOTE]

Dear pulse,
I have a battle every year with OSR .and the Valuer General. But to cut a very long story short, Land values in mosman are much higher than at randwick .A time may come when land value on your dads properties would actually be higher than value of his properties. When that gets close, The strata owners would be better off selling the whole block to a developer.
To answer the second part of your question, Land tax dept must now employ commission debt collectors, I reckon. They actively pursue people, they send officers out to the properties to find out who the PM is, then direct the PM to garnishee rentals, They put caveats on all the persons ' properties etc. etc..

The answer is that he has to fork out eventually. But the good news is that your dad can agree to pay and make arrangements. They ,I must say, are very agreeable and will let him pay by installments. Dont forget however, that a new lot of Land tax will become payable in about february!

 

[pulse]

Thanks for the advice guys... I've had a chance to see all the documents myself and its difficult to argue with the way they break it down. I think he will probably seek advice from a lawyer with land tax experience.

Regards
Pulse

 

[Les]

G'day pulse,

Isn't it so that OSR Land Tax can be challenged? (Maybe not if the payments are 4 years late - I don't know). But your comment about ADJACENT buildings having such marked differences in value are worth pursuing, I would've thought.... But, of course, the cheaper one MIGHT be revalued to match the dearer one

Your idea of employing a Solicitor with some knowledge sounds like a good move,

Regards,

 

[cloclo]

G'day pulse,

Isn't it so that OSR Land Tax can be challenged?

Regards,

Hi Les,

In NSW there is a time limit within which you may ask for a revaluation . Whether or not thay actually revalue, I dont know (sometimes they use contractors). Then they write back to tell you that the value is correct, but you have so many days to take it to the land and environment court if you are not happy.

I dispute valuations on many of my properties every year. Last year,I argued that land values in particular areas could not have increased by 38% from the previous assessment because the market had softened and property values had actually dropped. They wrote back to say that irrespective of what the previous assesssment was, these were the current values.( take it or leave it)

How can you argue with them? If someone finds a good lawyer who has experience with Land Tax, please let us know.

Last year I had land values increased on average by 20 to 38%, even though the market values had decreased by at least 10% !

 

[quickerblade]

What happens if you dont pay it.?

 

[bens]

In Wa, I know that they send a demand letter and then initiate legal action for the outstanding amount. They can also place a memorial on the title which becomes a first charge against the land. Once the debt has reached a high enough level they can legally sell the land to recover the debt.

So all bases covered for them really.

Cheers

Bens.

 

[cloclo]

What happens if you dont pay it.?

Hi quickerblade,

You cant not pay it. !st they put a caveat on your property (properties if you have more than one), Then they send an officer to the property and find out who the PM is. Then they send a threatening letter to the PM ordering them to hold all the rental money and forward it directly to them. ( If the PM doesn't do it ,they can be fined some huge amount under certain section) At the same time they can issue a statement of liquidated claim giving you 28 days. In the end they can sell the property to recover whats owed to them. They are doing all of those things at the moment which makes me think OSR is employing debt collectors but I am not 100% sure about that.

 

[quickerblade]

but i dont have a PM, whats caveat?

 

[cloclo]

but i dont have a PM, whats caveat?

A caveat is placed on your title deed by someone you owe money to, effectively stopping you from selling or refinancing it unless you have it removed by paying what you owe them. In NSW the caveat placed by the Land Tax dept. is in the name of Her Majesty The Queen Elizabeth 2. Sometimes they dont even tell you!

 

[quickerblade]

well my land tax bill is $360 for 2005, i'll just pay it, no need for dramas with the queen