Land Tax on new purchase

I hate to admit, but i made the same mistake.

After reading so much, I totally missed the land tax component (after purchasing my 2nd IP).

The only way to rectify this or minimize this would be via rent increase, renovation, time. So that the land tax can be a lesser ip expense.

Unless other ss can help with options to minimize the land tax effect???
 
Out of curiosity, how do you determine the exact land value so that you ensure you don't go over the threshold? I saw on the OSR website that you can order a report and it gives you the land value, is that the same data OSR uses to calculate your land value?
 
Out of curiosity, how do you determine the exact land value so that you ensure you don't go over the threshold? I saw on the OSR website that you can order a report and it gives you the land value, is that the same data OSR uses to calculate your land value?

Do you have Google Earth? Get on this: http://globe.six.nsw.gov.au/

You look up the address and it tells you the land value according to the department of lands and it's free.
 
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Unless other ss can help with options to minimize the land tax effect???

2 ways really
1. Different ownership
2. different states.

don't forget that in NSW joint owners get a threshold of $432k between them while single owners get a threshold of $432k each.

companies and SMSFs get their own thresholds - but seek advice before.
 
Can't say i've seen it. Do you know how the clause is normally worded?

(I actually think all the contracts I've looked at always have the Land Tax part ticked as no on the front page... perhaps thats why ive never noticed it?).

Clause 14 of the standard NSW contract refers to adjustments. Adjustments include rates, water etc... and land tax based on the adjustment date. That's the settlement date. If that is delayed the seller will impose the land tax on the buyer. That's why a special clause assists as it removes uncertainty about what date adjustments are based on. 14.4 says "MUST"...

Special clauses are usually added for settlement at year end where parties have a concern about a delay. ie a GST clause is often inserted where there may be concerns. A typical one is the vendor introduced by another agent clause. This protects the vendor from an adverse claim for (unknown) agency fees.
 

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Clause 14 of the standard NSW contract refers to adjustments. Adjustments include rates, water etc... and land tax based on the adjustment date. That's the settlement date. If that is delayed the seller will impose the land tax on the buyer. That's why a special clause assists as it removes uncertainty about what date adjustments are based on. 14.4 says "MUST"...

Special clauses are usually added for settlement at year end where parties have a concern about a delay. ie a GST clause is often inserted where there may be concerns. A typical one is the vendor introduced by another agent clause. This protects the vendor from an adverse claim for (unknown) agency fees.

But note the word 'normally'. Front page of the standard contract has a land tax adjustible box - with the default being NO (in capitals).

I haven't seen any contracts where land tax has been adjustible as most purchasers won't accept this. If the vendor cops it they can usually deductible whereas the purchaser may not.
 
Paul and Terry, thanks for clarifying those points regarding land tax. Good to know more about these things.

I've had one in the past marked YES in the land tax adjustable box, i went back and told them to change it and they agreed :)
 
Paul and Terry, thanks for clarifying those points regarding land tax. Good to know more about these things.

I've had one in the past marked YES in the land tax adjustable box, i went back and told them to change it and they agreed :)

If you are a vendor it is worth a shot.
 
But note the word 'normally'. Front page of the standard contract has a land tax adjustible box - with the default being NO (in capitals).

I haven't seen any contracts where land tax has been adjustible as most purchasers won't accept this. If the vendor cops it they can usually deductible whereas the purchaser may not.

I have done this in the past where there was a delayed settlement and it ran over the end of the calendar year.
 
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