{"id":2662,"date":"2020-01-06T09:19:19","date_gmt":"2020-01-05T22:49:19","guid":{"rendered":"https:\/\/www.oreon.com.au\/?p=2662"},"modified":"2020-01-06T09:19:19","modified_gmt":"2020-01-05T22:49:19","slug":"2019-sa-land-tax-reforms","status":"publish","type":"post","link":"https:\/\/www.oreon.com.au\/taxation\/2019-sa-land-tax-reforms\/","title":{"rendered":"2019 SA Land Tax Reforms"},"content":{"rendered":"
The Land Tax (Miscellaneous) Amendment Bill 2019<\/em> (Bill<\/strong>) in its final form (after various versions) received Royal Assent on 5 December 2019.\u00a0 The new measures set out under the Bill will commence on 30 June 2020.\u00a0 The measures represent significant land tax reforms and will impact all property owners.<\/p>\n The key changes made under the Bill include:<\/p>\n The measures under the Bill significantly change the current land tax provisions in relation to the following:<\/p>\n Land held by multiple owners will initially be assessed as one taxpayer.\u00a0 Each owner will then<\/u> be assessed on their fractional interest in the jointly owned land (aggregated with their other interests in taxable land) with each owner receiving a non-refundable credit for the initial tax assessed.\u00a0 This is likely to increase the land tax liability for mums and dads who own property jointly and individually.<\/p>\n Trustees are not subject to aggregation unless the property is held for the \u201csame trust\u201d. Land tax will be applied to the property held by the trustee at surcharge rates unless a designated beneficiary is nominated. Land that is acquired by the trust after 16 October 2019 <\/u>will attract the surcharge rates.<\/p>\n If a nomination is made (must be done no later than 30 June 2021<\/u>), the trustee will be assessed at general rates and the beneficiary, deemed the \u201cowner\u201d of the land for land tax purposes, will also be assessed at general rates (aggregated with any other interests they hold in taxable land).<\/p>\n The trustee of a fixed or unit trust will be assessed at the surcharge rates unless the Commissioner is notified of the unit holders, in which case the trustee will be assessed at the general rates and the unit holders assessed on their proportionate interest in the land held by the unit trust (aggregated with all the unit holders\u2019 interests in other taxable land) and assessed at the general rates. The unit holders will receive a \u2018deduction\u2019 on account of the land tax paid by the trustee. Land held by corporate trustees of unit trusts and fixed trusts could be grouped with land held by related corporations where more than 50% of the units or interests in the trust are held by a company or company group.<\/p>\n The new measures impose substantial notification requirements on trustees, these include notifying the Commissioner when a trustee acquires or disposes of SA real property, when there has been a change in the unit holdings of a unit trust holding SA real property and when \u201canything happens\u201d that results in the trust becoming a \u201cdifferent category\u201d of trust.\u00a0 Notifications must be made within one month of the prescribed event occurring.\u00a0 Trustees that hold SA real property at the commencement of the new measures (30 June 2020) must notify the Commissioner by 30 July 2020.<\/p>\n Various types of trusts will be excluded from the new measures including complying SMSF’s, LRBA bare trusts, deceased estates, charitable trusts, public unit trusts and special disability trusts.<\/p>\n New measures have been introduced to group \u201crelated corporations\u201d for land tax purposes. As such, land tax will be assessed on the aggregated value of the land held by all<\/u> related companies. Assessments may be issued to companies jointly or separately such as to make the related corporations jointly and severally liable for the land tax assessed on the group. \u00a0\u00a0Therefore, the Commissioner in practice may chase the assessment for the whole group from the company in the group with the greatest capacity to pay the assessment.<\/p>\n Whether companies are related will depend on whether the same \u201cperson\u201d or \u201cgroup of persons\u201d have a \u201ccontrolling interest\u201d in the company.\u00a0 The new measures are potentially very broad in application, in general terms, when determining \u201ccontrolling interest\u201d, taxpayers should consider who:<\/p>\n The Bill introduces various new concessions, these include the following:<\/p>\n Under the new measures, planning considerations include:<\/p>\n We recommend that property owners review their existing property structures as soon as possible to ensure they are familiar with the new measures and to determine the impact of the new measures on their existing property structures.<\/p>\n Please do not hesitate to contact us on (08) 8161 1000 if you have any queries.<\/p>\n The comments above are of a general nature only and are not intended to be, and should not be regarded as, legal advice.\u00a0 For legal advice on your specific circumstances, you must consult a suitably qualified professional advisor. Content by WRP Legal & Advisory.<\/p>\n","protected":false},"excerpt":{"rendered":" The Land Tax (Miscellaneous) Amendment Bill 2019 (Bill) in its final form (after various versions) received Royal Assent on 5 December 2019.\u00a0 The new measures set out under the Bill will commence on 30 June 2020.\u00a0 The measures represent significant land tax reforms and will impact all property owners. The key changes made under the […]<\/p>\n","protected":false},"author":3,"featured_media":2668,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_kad_blocks_custom_css":"","_kad_blocks_head_custom_js":"","_kad_blocks_body_custom_js":"","_kad_blocks_footer_custom_js":"","footnotes":""},"categories":[27],"tags":[],"acf":[],"yoast_head":"\n\n
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Jointly Owned Property<\/h2>\n
Discretionary Trusts<\/h2>\n
Fixed and Unit Trusts<\/h2>\n
Trustee reporting requirements<\/h2>\n
Excluded Trusts<\/h2>\n
Related Corporations<\/h2>\n
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New Concessions<\/h2>\n
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\u00a0Planning Considerations<\/h2>\n
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General Rates (2020\/2021 income year)<\/h2>\n
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\n Taxable value of land<\/strong><\/td>\n Amount of tax<\/strong><\/td>\n<\/tr>\n \n 0 to 450,000<\/td>\n $0<\/td>\n<\/tr>\n \n 450,001 to 755,000<\/td>\n $0 + 0.50% of excess<\/td>\n<\/tr>\n \n 755,001 to 1,098,000<\/td>\n $1,525 + 1.25% of excess<\/td>\n<\/tr>\n \n 1,098,001 to 1,350,000<\/td>\n $5,812\u00a0 + 2.00% of excess<\/td>\n<\/tr>\n \n Over 1,350,000<\/td>\n $10,852 + 2.40% of excess<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n Trust Surcharge Rates (2020\/2021 income year)<\/h2>\n
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\n Taxable value of land<\/strong><\/td>\n Amount of Tax<\/strong><\/td>\n<\/tr>\n \n 0 to 25,000<\/td>\n $0<\/td>\n<\/tr>\n \n 25,001 to 450,000<\/td>\n $125 + 0.50% of excess<\/td>\n<\/tr>\n \n 450,001 to 755,000<\/td>\n $2,250 + 1.00% of excess<\/td>\n<\/tr>\n \n 755,001 to 1,098,000<\/td>\n $5,300 + 1.75% of excess<\/td>\n<\/tr>\n \n 1,098,001 to 1,350,000<\/td>\n $11,302 + 2.40% of excess<\/td>\n<\/tr>\n \n Over 1,350,000<\/td>\n $17,350 + 2.40% of excess<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n What next?<\/h2>\n
Disclaimer<\/h2>\n