Land Tax VIC — Rates, Thresholds and Exemptions (2026)
Victorian land tax is administered by the State Revenue Office VIC (SRO VIC). It is an annual tax on the total taxable land value of all Victorian landholdings above the threshold. Victoria has some of the most complex land tax rules in Australia — including different thresholds for individuals, companies and trusts, and an absentee owner surcharge that applies beyond the foreign purchaser duty.
VIC Land Tax Threshold (2026)
| Taxpayer Type | Threshold |
|---|---|
| Individual or company | $300,000 |
| Absentee owner | $300,000 |
| Trust (general) | $25,000 |
VIC’s threshold of $300,000 is significantly lower than NSW’s ~$1,075,000. This means far more Victorian property investors pay land tax — particularly in Melbourne, where land values are high.
VIC Land Tax Rates (2026)
Individual/Company rates:
| Total Taxable Land Value | Rate |
|---|---|
| Below $300,000 | Nil |
| $300,001–$600,000 | $375 + 0.2% over $300,000 |
| $600,001–$1,000,000 | $975 + 0.5% over $600,000 |
| $1,000,001–$1,800,000 | $2,975 + 0.8% over $1,000,000 |
| $1,800,001–$3,000,000 | $9,375 + 1.3% over $1,800,000 |
| Over $3,000,000 | $25,000 + 2.55% over $3,000,000 |
Note: Additional levies may apply — see COVID debt levy below.
VIC Land Tax — Worked Examples
Example 1: Single investment property, land value $500,000
- Taxable value: $500,000 − $300,000 = $200,000
- Land tax: $375 + 0.2% × $200,000 = $375 + $400 = $775 per year
Example 2: Single investment property, land value $800,000
- Taxable value: $800,000 − $300,000 = $500,000
- First $300,000 of taxable amount: $375 + 0.2% × $300,000 = $975
- Next $200,000 of taxable amount: $975 + 0.5% × $200,000 = $1,975 per year
Example 3: Two investment properties, total land value $1,200,000
- Taxable value: $1,200,000 − $300,000 = $900,000
- $375 + 0.2% × $300,000 = $975
- Then $975 + 0.5% × ($900,000 − $300,000) = $975 + $3,000 = $3,975 per year
VIC COVID Debt Levy (Temporary Surcharge)
The Victorian government introduced a temporary COVID Debt Levy applicable to landholdings above certain values. This levy is in addition to the standard land tax rates and applies for a fixed period (2024–2033).
Approximate additional levy rates:
- Landholdings $50,000–$100,000: $500 flat fee
- Landholdings $100,001–$300,000: $975 flat fee
- Landholdings $300,001–$1,000,000: 0.1% additional
- Landholdings over $1,000,000: 0.1% additional
The COVID Debt Levy is a temporary measure. Verify current applicability and rates with SRO VIC (sro.vic.gov.au).
VIC Trust Land Tax
Trusts in Victoria face much less favourable land tax treatment:
- Threshold: $25,000 (not $300,000)
- Rate: Flat 0.375% of the total land value (from the first dollar above $25,000) — there is no progressive bracket structure for trusts
- The trustee pays land tax at the trust rate for all trust-held land
Example: Land value $500,000 in a trust:
- Taxable value: $500,000 − $25,000 = $475,000
- Land tax: 0.375% × $475,000 = $1,781 per year
- vs individual holding: $975 per year
Why this matters: Many property investors have historically used discretionary trusts. The unfavourable trust land tax rates in VIC significantly increase the holding cost for trust-held investment properties.
VIC Absentee Owner Surcharge
Victorian property owned by absentee owners (individuals who are not Australian citizens, permanent residents or residents who have not resided in Australia for the relevant period) is subject to an additional surcharge:
- Absentee Owner Surcharge: 4% of the total land value per year
- This is in addition to standard land tax rates
- Applies to residential and some commercial land
Example: Absentee owner, land value $600,000:
- Standard land tax: ~$1,975
- Absentee owner surcharge: 4% × $600,000 = $24,000
- Total: ~$25,975 per year
Principal Place of Residence — VIC Exemption
Your principal place of residence is exempt from VIC land tax.
Conditions:
- Must be an individual (not a company or trust)
- Must be your primary home — holiday homes and investment properties are not exempt
- You can claim only one principal residence exemption
Holiday homes: Not exempt — holiday homes are subject to VIC land tax. This affects many Victorians with beach houses in popular coastal areas.
Other VIC Land Tax Exemptions
| Exemption | Conditions |
|---|---|
| Primary production land | Farm use in metropolitan area: specific rural criteria apply |
| Charitable organisations | SRO VIC approval required |
| Retirement villages | Land used for retirement village purposes |
| Builders and developers | Exemption may apply during development (short window) |
| Vacant land (new residential) | Short exemption may apply while developing; check with SRO VIC |
When Is VIC Land Tax Assessed?
- Land tax is assessed as at 31 December each year
- SRO VIC sends assessments from January
- Land values are determined by the Valuer-General Victoria
Is VIC Land Tax Deductible?
Yes — VIC land tax paid on investment properties is a deductible expense for income tax purposes (as a rental property expense).
Frequently Asked Questions
What is the land tax threshold in Victoria? $300,000 for individuals and companies. $25,000 for trusts. Verified at sro.vic.gov.au.
Do I pay VIC land tax on my own home? No — your principal place of residence is exempt. Land tax applies to investment properties and holiday homes.
Is Victorian land tax more expensive than NSW? At most price points, yes — VIC’s threshold is lower ($300k vs NSW ~$1,075k), meaning more investors pay land tax and at lower land values. However, VIC’s progressive rates above the threshold are lower than NSW at equivalent taxable amounts.
Is my holiday house in Victoria liable for land tax? Yes — holiday homes are not exempt from VIC land tax. This is a notable difference from some other states where holiday homes may receive partial concessions.
Related Guides
This article provides general information about Victorian land tax. Rates, thresholds and exemptions are set by the State Revenue Office VIC and change annually. Always verify with SRO VIC (sro.vic.gov.au). Land tax may have income tax implications — consult a registered tax agent. For advice tailored to your situation, speak with a licensed financial adviser. Find one through MoneySmart.