Land tax in Queensland: who pays it, the thresholds and the exemptions

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Kooky

Builder of Shaka, the payment router that pays every agent their commission on closing date.

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Every year, at midnight on 30 June, the Queensland Government takes a snapshot of who owns what land. Anyone whose holdings are over a threshold on that night owes land tax for the whole of the financial year that follows. Most households never receive an assessment, because the home they live in is generally exempt. Those who do are mainly people with a second property, a block held for later, or land owned through a company or a family trust.

Land tax is one of the least understood costs of owning property in Queensland. It is not council rates, it is not based on what a property would sell for, and it is not charged property by property. This guide explains who pays it, how the taxable value is worked out, what the thresholds and rates are for individuals, companies, trustees and absentees, how the home exemption and the other exemptions work, and what happens between the assessment notice and the payment. The rules are those published by the Queensland Revenue Office, the part of Queensland Treasury that administers the tax.

Queensland Revenue Office, land tax pages. Thresholds apply to total taxable land value.

What land tax is, and what it is not

The Revenue Office describes land tax as a State tax calculated on the freehold land a person owns in Queensland at midnight on 30 June, for the full financial year from July to June. It applies to individuals, companies, trusts and absentees. It applies to vacant land and to land that has been built on, including houses, apartments, commercial premises and investment properties, whether or not the property is occupied.

Three features set it apart from the other bills an owner receives.

It is a State tax. Council rates are set and collected by the local council and fall on every property. Land tax is collected by the Revenue Office and falls only on owners above a threshold. The two begin from the same land valuation, which is why they are often confused, but they are separate taxes with separate rules.

It is a tax on land, not on buildings. The value used excludes improvements such as houses and landscaping. A modest house on a large inner-suburban block can carry more land tax than a new apartment worth far more on the market.

It is a tax on the owner's total. The question is not whether any one property is over the threshold but whether all of an owner's taxable land in Queensland, added together, is. Two blocks that are each well under the line can produce an assessment together.

Midnight on 30 June decides everything

Land tax has no pro-rata. The person who owns land at midnight on 30 June is liable for the entire financial year that begins the next day. An owner who sells on 5 July still owes the year's tax. A buyer who settles on 1 July owes nothing for that year on that land.

The same date fixes the other facts that matter. Whether a property was the owner's home, whether an exemption applies and what kind of owner holds the land are all tested as at 30 June. So is the valuation: new land values issued by the Valuer-General take effect on 30 June of the year they are issued, and the 2026 round, covering 15 local government areas, takes effect on 30 June 2026.

For anyone buying or selling an investment property around the middle of the year, the settlement date therefore decides who carries a full year of land tax. That is a matter the parties and their conveyancers deal with in the contract, and it is one of the few places where a day either way has a cost.

The value that is taxed

Land tax is charged on taxable value, and taxable value starts with the statutory valuation made by the Valuer-General under State law. The Revenue Office is required to use those valuations; it does not make its own.

For land in towns and cities the Valuer-General assesses site value. The State's valuation pages explain that this is the value of the land without structural improvements such as houses, sheds and fences, though it does include work done to prepare the land, such as filling, clearing and drainage. Rural land is valued on an unimproved basis, as if in its natural state.

The valuation is not the last step. The Revenue Office says the taxable value of a parcel is the lesser of two figures: its statutory land value for the financial year, and its averaged value for that year.

A quick illustration, using made-up figures: a block valued at $500,000, $500,000 and then $650,000 in three successive years has an averaged value of $550,000 in the third year. Since $550,000 is less than $650,000, the taxable value is $550,000. The following year, if the valuation stays at $650,000, the average rises to $600,000, and the year after that it reaches $650,000.

Averaging also explains why an assessment can rise in a year when the valuation did not: the average is still catching up with an earlier increase.

Thresholds and rates for individuals

An individual is liable for land tax if the total taxable value of their freehold land at 30 June is $600,000 or more, according to the Revenue Office. Below that, nothing is payable. At and above it, the tax is a fixed amount plus a number of cents for each dollar over the bottom of the bracket.

The Revenue Office gives two examples of its own. Land with a taxable value of $680,000 attracts $1,300: the $500 base plus one cent on each of the $80,000 above the threshold. Land with a taxable value of $6.4 million attracts $87,000.

Two things about the scale are worth noticing. There is a step at the threshold: an owner at $599,999 pays nothing and an owner at $600,000 pays $500. And the middle of the scale is steeper than the bottom. Between $600,000 and $1 million each extra dollar of land value costs one cent a year; between $1 million and $3 million it costs 1.65 cents. The chart applies the published formulas to five land values.

Because the threshold is tested against land value and not market value, many investors with one rental property fall under it. An apartment's share of the land beneath a building is often small. A house on a full-sized block in an established suburb is a different matter, and an investor with two such houses can be over $1 million in taxable land without owning anything unusual.

Companies, trustees and absentees

Land held by a company or by the trustee of a trust is taxed on a different and less generous scale. The threshold is $350,000, and the rate above it starts at 1.7 cents in the dollar.

The difference is large at ordinary values. On $750,000 of taxable land an individual pays $2,000, which is $500 plus one cent on $150,000. A company or trustee pays $8,250, which is $1,450 plus 1.7 cents on $400,000. On $500,000 an individual pays nothing and a trustee pays $4,000. Anyone weighing up whether to buy an investment property in their own name or through a family trust or company will find land tax on one side of the ledger; the other considerations, such as asset protection and income tax, are for the owner's advisers.

Absentees are the third group. The Revenue Office treats a person as an absentee for land tax if they are a foreign individual without a permanent visa or do not normally live in Australia. Australian citizens and holders of permanent visas are not absentees. Absentees are taxed from $350,000 on a scale that begins like the company scale, at $1,450 plus 1.7 cents for each dollar over $350,000, and differs at the top, where the rate is 2 cents between $5 million and $10 million and 2.5 cents above that.

On top of the ordinary scales sit the foreign surcharges. An absentee surcharge of 3 per cent applies where an absentee's taxable land is valued at $350,000 or more, and the Revenue Office applies a 3 per cent surcharge in the same way to foreign companies and the trustees of foreign trusts. Relief from the surcharge is available in limited cases, and the Revenue Office requires those who hold it to confirm their continued eligibility with a statutory declaration each year.

The home exemption

The exemption that keeps most Queenslanders out of land tax is the one for land used as a home, which the Revenue Office also calls the principal place of residence exemption. It can apply to all of the land or to part of it.

The exemption is tied to actually living in the property. For an individual, the Revenue Office's page on the exemption looks at whether the property was used as the owner's home between 1 January and 30 June of the relevant year, or from the date of purchase if it was bought after 1 January. A property bought and moved into in the first half of the year can therefore qualify on the following 30 June.

The page lists the circumstances that put the exemption in question. They include holding the land as a trustee instead of personally, the property being someone else's home and not the owner's, renting out all or part of the home, and running a business from it. Where part of a home is used in one of those ways, the exemption may be reduced or lost, and the Revenue Office decides the outcome on the facts.

Trustees are dealt with separately. There is a land tax exemption for trustees covering a home where all the beneficiaries of the trust or estate live, which is narrower than the exemption for individuals. A family that holds its own house in a discretionary trust should not assume the house is exempt simply because the family lives there.

The most common way an owner-occupier meets land tax is through a change of circumstances that nobody thought of as a tax event. A couple moves interstate for work and lets the house. An owner moves in with a new partner and keeps the old home as a rental. A parent moves into care and the family rents out the house to cover costs. In each case the home may no longer be exempt on the next 30 June, and if the land is valuable enough the first assessment arrives some months later.

Other exemptions and relief

The Revenue Office's exemptions and relief page lists the other categories. Each has its own conditions, and the page is a starting point, not the detail.

A transitional home exemption exists for owners caught between two homes on 30 June. Land used for the business of primary production can be exempt, on application using the office's form for that purpose. There is an exemption for charitable institutions. Other exemptions cover particular uses, among them caravan parks and aged care facilities. Deceased estates have their own relief. Developers who subdivide land can receive a subdivider discount. Build-to-rent developments that meet the criteria attract a concession.

What these have in common is that they depend on use at 30 June and usually on an application. An exemption that applied last year does not carry forward if the use has changed.

From assessment notice to payment

Land tax is not self-assessed by the owner. The Revenue Office works out the liability from the land records and the valuations and sends an assessment notice.

The notice shows the owner's client number and a payment reference, the type of owner the office has recorded, the amount owing and the due date, and an itemised summary of each parcel with its taxable value and any exemption applied, shown as a code. It is worth reading the summary line by line. A parcel that has been sold, a property that should be exempt, or an owner type recorded wrongly will all change the result.

Payment can be made in full by the due date on the notice. The alternative is the extended payment option, under which the tax is paid over a longer period in three instalments; the application has to be made within 35 days of the notice's issue date. If the tax is not paid by the due date, unpaid tax interest may apply.

An owner who disagrees with an assessment can lodge an objection within 60 days of the issue date. That is a dispute about how the tax has been worked out: the ownership, the exemption, the owner type. A dispute about the land value itself is a different process, made to the Valuer-General and not to the Revenue Office, and it has its own 60-day period that runs from the issue of the valuation notice. Where a valuation is reduced on objection, the Revenue Office reassesses. Its guidance gives the example of a parcel valued at $450,000 that was reduced to $400,000, producing a refund for the tax year concerned.

Buying, selling and land tax

For a buyer, land tax raises two questions. The first is whether the purchase will make the buyer liable. A first investment property with a land value under $600,000, held personally, will not. A second or third may, because the values are added together, and a purchase through a company or trust is tested against $350,000.

The second question is whether the seller owes land tax on the property being bought. The Revenue Office issues land tax clearance certificates, and checking the land tax position is a routine part of what a buyer's solicitor or conveyancer does before settlement. Under the standard contract, land tax is one of the outgoings adjusted between the parties, alongside rates.

For a seller, the point to remember is the snapshot. Land owned at midnight on 30 June carries the whole year's tax, even if it is sold a week later.

Misunderstandings worth clearing up

A handful of mistaken ideas come up again and again.

Land tax is not based on the purchase price or the market value. It is based on the Valuer-General's land value, averaged as described above.

Owning one investment property does not by itself mean land tax. What matters is whether the taxable land value reaches the threshold.

The threshold is not an allowance for each property. It applies once to the owner's total.

A home is not exempt because it is a home; it is exempt because the owner lives in it and meets the conditions, and in some cases has applied.

And the thresholds are fixed dollar amounts. They do not move automatically when land values rise. An owner comfortably under $600,000 today can be over it after a revaluation, with averaging slowing the change but not preventing it. Checking the valuation notice when it arrives, which in the 2026 round was issued in March, is the earliest warning an owner gets of what the next assessment will look like.

How any of this applies to a particular owner depends on what they own, how they hold it and how it is used, and the Revenue Office's own pages and calculators are the reference for an individual case.

Kooky, from Shaka

Kooky edits Queensland Estate and builds Shaka, the payment router he made for Queensland property professionals. One payment comes in, and every agent, agency and party in the deal receives their signed share on closing date.

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