For property owners and investors, paying land tax isn’t something new.

Just for a bit of background, the current land tax arrangements are based on the land holdings you have in Queensland that exceed the tax free threshold ($600,000 for individuals, $350,000 for companies, trustees and absentees).

You can read about the current land tax thresholds and rates here: 


What are the changes?

From 30th June, 2023, if you own land in Queensland then you will need to also declare your interstate land holdings and these will be taken into consideration for the purposes of calculating Queensland land tax payable.

The total value of your Australian land will be used to determine two key points:

  • Whether you have reached the tax-free threshold for payment of land tax
  • The rate of tax that will be applied to your Queensland property.

Some important points about this:

  • If you only hold land in Queensland then there is no change to your land tax.
  • You will only pay land tax on the portion of land owned in Queensland, not tax on the total landholdings.
  • Your principal place of residence is excluded from the land tax calculation. 

How will they impact investors?

If you hold investment property in Australia, outside of Queensland, then this will impact you and you can expect to be paying more land tax.

The Queensland Government uses the example on their website of a property owner who owns taxable land in Queensland of $745,000 and interstate taxable land of $1,565,000.  In this example the owner would currently pay $1950 in land tax, but under the changed legislation, this owner would now pay $8422.37. 

Let’s provide another example:

Jo and Tim own their PPR in Sydney, plus an investment property in Melbourne (land value $750k) and one in Brisbane (land value $550k), all held jointly in their individual names.   Under current land tax arrangements for Queensland, they would not meet the land tax threshold for Queensland and no tax would be paid.  Under the new legislation their taxable land value would now be $1,300,000.

Land tax calculation:  $4500 +(1.65 cents x $300.000) = $9450

This amount is then applied to the Queensland portion of Jo and Tim’s land ($550,000/$1,300,000 x $9450) = $3998.08.

$3998.08 would be the land tax paid in this instance.  

What should I do if I own investment property outside of QLD?

Determine your land holding across all states and work out the expected changes to your land tax (if any) to see how this will impact you directly. Note that if you hold property in your superannuation fund or a trust, then these are separate entities and each entity is assessed individually.

What should I consider if buying in Queensland?

Consider the entity in which you intend to purchase the property to see if you will be impacted.

Consider what properties you hold in other states within the same entity and the expected land value of a purchase you are going to make in Queensland to work out the expected land tax cost each year.

Consider whether an apartment may meet your investment goals as land tax assessment will be much less as you only own a portion of the land.

Consult with us at Property Zest if you would like assistance with this.

Can I increase the rental income on my property to cover the increase in land taxes?

There is no specific provision in a tenancy agreement to allow an owner to recover taxes or costs associated with an investment property.  You can, however, increase the rental amount you charge a tenant as long as this increase is made in line with residential tenancy legislation.  This normally means you must give the prescribed notice period and this can only be done at the renegotiation of a tenancy agreement and not whilst a fixed term agreement is within place.

Consult with our Property Management team at Property Zest if you’d like to discuss this.

How will these changes impact the property market in Queensland

The Queensland state government is the first and only state to introduce this change to assess state based land taxes on nationally held property and it’s certainly not well regarded within the property industry or with property investors.  

Property owners are expected to increase rentals to help mitigate their costs which in turn places further cost of living issues back onto tenants.

These land tax changes are also expected to act as a disincentive for investors from buying property in Queensland or cause some property owners to exit the Queensland market altogether.  This will reduce the already scarce availability of rental property in Queensland and further drive rental prices up.

Will other states be introducing the same amendments to their land tax calculations?

Now this is the sixty four million dollar question and one we’ll all be watching closely.  It seems counterintuitive for a government to be disincentivizing investment within its own state and adding pressure to the rental market and cost of living, but if it flies…well, I’d expect to see other states following suit.  If not though, it may be a painful lesson for Queensland.  

Can we stop this legislation from coming into effect?

The property industry in Queensland have been vocal since the proposed legislation was tabled, however, the government acted to move it through parliament with minimal, token consultation and it has already been passed.  Groups such as the Real Estate Industry Queensland are continuing to lobby for the repeal of this legislation.

Where can I find further information

You can find information on Queensland Government website: