🇦🇺 Land Tax in Australia: A State-by-State Guide (2025)

Here’s a general overview of land tax rates for residential property across Australia’s states and territories in 2025, including which jurisdictions have the highest and lowest burdens. In Australia, land tax is a state/territory tax on the unimproved value of land you own (not usually the home you live in) and the rules differ widely from place to place.

For specific details about the land tax relevant to each state, please speak with your accountant, since this blog is intended only as a general reference.

📌 What is Land Tax?

Land tax is an annual tax levied by state and territory governments on the value of all taxable land you own above a threshold.✔ It generally does not apply to your principal place of residence.✔ It does apply to investment properties, vacant land and some commercial land.✔ Most jurisdictions also apply surcharges for absentee or foreign owners.

State & Territory Land Tax Overview

Below is a general summary of land tax thresholds and rates for each Australian state and territory in 2025.

New South Wales (NSW)

• Principal Place of Residence (PPR): You generally do not pay land tax on land that is your primary residence.

• Tax-free threshold: More than $1,075,000 but less than $6,571,000 ($100 + 1.6% of the land value above $1,075,000)

• More than $6,571,000 ($88,036 + 2% of the land value above $6,571,000)

• Land tax rates: progressive — starting at ~1.6% above the threshold, rising to ~2.0% on higher band values.

• Nil Threshold for Special Trusts: The land tax general threshold of $1,075,000 does not apply to special trusts.

• An additional surcharge land tax of 5% applies to foreign persons who own residential land in NSW, and this surcharge has no tax-free threshold.

• Features: One of the highest thresholds in Australia, meaning only higher-value portfolios are taxed.

  https://www.revenue.nsw.gov.au/taxes-duties-levies-royalties/land-tax

  
  

Victoria (VIC)

• Principal Place of Residence (PPR): Your primary home is generally exempt from land tax. The threshold applies to investment properties, holiday homes, commercial land, and vacant land.

• Tax-free threshold: ~$50,000 for individuals and companies (very low) and $25,000 for land held in trust.

• Land tax rates: progressive from ~0.2% up to ~2.55%+ depending on land value.

• Additional levies: 4% absentee owner surcharge; vacant residential land tax also applies statewide from 2025.

• COVID Debt Levy: The reduced thresholds and increased rates are part of the Victorian Government's "COVID debt levy," which is expected to be in effect until June 30, 2033.

• Note: Victoria’s low threshold means many more properties are subject to land tax, even smaller investment properties.

  https://www.sro.vic.gov.au/owning-property/land-tax

  
  

Queensland (QLD)

• Principal Place of Residence (PPR): You generally do not pay land tax on land that is your primary residence.

• Threshold: $600,000 (individuals); $350,000 (companies, trusts & absentee owners)

• Rates: about 1– 2.75% progressive depending on total land value.

• Features: Broadly middle ground, but companies and trusts face lower thresholds.

  https://qro.qld.gov.au/land-tax/calculate/individual/

  
  

Western Australia (WA)

• Principal Place of Residence (PPR): You generally do not pay land tax on land that is your primary residence.

• Threshold: ~$300,000

• Rates: ~0.25% up to ~2.67% for higher land values.

• The land tax threshold for trusts is generally the same as for individuals, set at an aggregated unimproved value of $300,000. 

• If your land is located within the Perth metropolitan region and is subject to land tax, you must also pay a Metropolitan Region Improvement Tax (MRIT) of 0.14% on the value above the $300,000 threshold. 

• Features: No foreign/absentee land tax surcharge as of 2025.

  https://www.wa.gov.au/organisation/department-of-treasury-and-finance/land-tax-assessment

  
  

South Australia (SA)

• Principal Place of Residence (PPR): You generally do not pay land tax on land that is your primary residence.

• Threshold: ~$833,000 and Trust tax threshold: $25,000

• Rates: ~0.5% to 2.4% progressive.

• Features: Moderate thresholds and tax brackets.

  https://www.revenuesa.sa.gov.au/land-tax/rates-and-thresholds

  
  

Tasmania (TAS)

• Principal Place of Residence (PPR): You generally do not pay land tax on land that is your primary residence.

• Threshold: ~$125,000

• Rates: ~0.55% to 1.5% (relatively low).

• Land owned by a trust is assessed separately, and generally follows these same general land tax rates and thresholds.

• Features: One of the lowest maximum rates and low tax burden.

  https://www.sro.tas.gov.au/land-tax/rates-of-land-tax

  
  

Australian Capital Territory (ACT)

• The Australian Capital Territory (ACT) does not have a single, universal land tax threshold in the same way other states do. Instead, land tax applies to all non-exempt properties, primarily those that are not your principal place of residence. 

• The land tax rate (variable charge) and the fixed charge depend on the Average Unimproved Value (AUV) of the property. For the 2025-26 period, the variable charge ranges from 0.54% for AUV up to $150,000, increasing in tiers to 1.26% for AUV of $2,000,001 and higher. The fixed charge is $1,693 across all AUV brackets. 

  Key Points

• There is no tax-free threshold for properties held in trust. The tax is calculated based on the Average Unimproved Value (AUV) of the property from the very first dollar of value.

• Rates: ~0.54% up to ~1.26%.

• Features: Unique quarterly assessment and flat component.

  https://www.revenue.act.gov.au/land-tax

  
  

Northern Territory (NT)

• No land tax is levied in the Northern Territory in 2025 including those held in trusts.

  https://nt.gov.au/property/land/buying-and-selling-land/land-taxes

  
  

📊 Comparing the Burden: Highest and Lowest

Highest Land Tax Burden (General Residential Investment)

• Victoria stands out for having:

  • Very low tax-free threshold (~$50,000), meaning many more landowners pay tax.

  • Progressive rates up to around 2.55% plus absentee and vacancy levies, making land tax impactful even on modestly valued properties.➡ This often translates into the highest relative land tax burden for many investment owners.

    
    

• Queensland has among the highest top marginal rates (~2.75%), especially for large portfolios and company/trust holdings.

Lowest Land Tax Burden

• Northern Territory: No land tax at all, so it’s unquestionably the lowest.

• Tasmania: Very low rates and thresholds compared with most states, making its overall land tax burden among the lowest for investment owners who exceed the small threshold.

  
  

💡 Key Takeaways for Property Investors

• Principal place of residence is typically exempt — so land tax usually affects only investment or non-owner-occupied properties.

• Thresholds and rates vary dramatically 

• Surcharges matter — absentee/foreign surcharges in NSW, VIC and QLD can significantly add to the base rate for some owners.

• NT remains unique in not levying land tax at all, offering the lowest regulatory burden.

  
  

Final Word

Australia’s land tax system remains complex and highly state-dependent. Property investors — especially those holding portfolios across multiple states — need to understand each jurisdiction’s thresholds, rate structure, and potential surcharges to estimate their annual tax liabilities accurately.

If you’re considering buying investment property or restructuring ownership, it’s worth consulting a local tax professional because even small changes in value can push you into higher tax brackets or trigger new liabilities.

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Published by

Nick Karayanis B.Eng. UNSW (Civil)

Licensed Contractor NSW (Building)

Disclaimer:

The content of this blog is for informational and educational purposes only and should not be considered professional financial, legal, or real estate advice. Every real estate transaction and renovation project is unique, and you should consult with qualified professionals, such as real estate agents, contractors, and legal advisors, to address your specific needs and circumstances. The information provided here is based on personal experiences and research and may not reflect current market conditions or regulations in your area. Readers assume all responsibility for decisions made based on the content of this blog.