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April 14, 2020

NSW Introduces 25% Land Tax Relief

Published by:
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David Armstrong
NSW Introduces 25% Land Tax Relief

New South Wales Government has announced a $440 million in stimulus relief for commercial and residential landlords in the form of a land tax reduction. The relief measures must be passed on to tenants who have been negatively impacted by COVID-19.

The tax relief package will provide landlords with the ability to apply for a concession of up to 25% on their land tax liability for the 2020 calendar year.

A land tax deferral for outstanding amounts for a three-month period will also be offered to landlords who claim the tax concession.

Who is eligible?

The land tax relief is expected to be divided 50/50 with both the commercial sector and the residential sector.

Commercial landlords

Any land tax relief must be passed on to business tenants with a turnover of less than $50 million that has experienced a 30% or more reduction in revenue due to COVID-19.

This includes businesses with annual turnover of less than $50 million who are eligible for the Commonwealths JobKeeper program.

Residential landlords

Residential tenants who are struggling to make rental payments or have suffered a loss of income of 25% or greater due to COVID-19 will need to negotiate with their landlord or managing agents.

Residential landlords will be eligible for a land tax waiver or rebate up to 25%, if the savings are passed to tenants in financial distress.

Code of Conduct

A Code of Conduct will operate for a temporary period during the pandemic with the following key measures:

  • Landlords must negotiate rent relief agreements with tenants in financial distress due to COVID-19 by applying the leasing principles in the Code;
  • A ban on the termination of a lease for non-payment of rent;
  • A freeze in rent increases.

The NSW Small Business Commission will receive extra staff and an injection of $10 million from the $1 billion Working for NSW Fund to assist in delivering increased mediation and advisory services.

Changes to evictions

An interim 60-day moratorium on finalising existing matters or making new applications for forced evictions over rent arrears related to COVID-19 has been put in place.

Tenants will be protected from eviction until the NSW Civil and Administrative Tribunal (NCAT) is satisfied negotiations have concluded.

Unpaid rent during this time will accrue as arrears.

Want to know more?

More information can be found on NSW state-based initiatives here.

With the equity markets and Government support packages frequently changing, we are continually updating please click here to view our latest materials.

Below are some articles that may interest you:

• JobKeeper Payment: Relief for Employers and Employees
• Are you entitled to the Federal Government Stimulus Package

We’re here and ready to support you through the changes. Contact us on 1300 888 803 book a catch up with a Modoras professional.

IMPORTANT INFORMATION: This blog has been prepared by Modoras Accounting (SYD) Pty. Ltd. ABN 18 622 475 521. The information and opinions contained in this blog is general information only and is not intended to represent specific personal advice (Accounting, taxation, financial, insurance or credit). No individuals’ personal circumstances have been taken into consideration for the preparation of this material. The information and opinions herein do not constitute any recommendation to purchase, sell or hold any particular financial product. Modoras Accounting (SYD) Pty. Ltd. recommends that no financial product or financial service be acquired or disposed of or financial strategy adopted without you first obtaining professional personal financial advice suitable and appropriate to your own personal needs, objectives, goals and circumstances. Information, forecasts and opinions contained in this blog can change without notice. Modoras Accounting (SYD) Pty. Ltd. does not guarantee the accuracy of the information at any particular time. Although care has been exercised in compiling the information contained within, Modoras Accounting (SYD) Pty. Ltd. does not warrant that the articles within are free from errors, inaccuracies or omissions. To the extent permissible by law, neither Modoras Accounting (SYD) Pty. Ltd. nor its employees, representatives or agents (including associated and affiliated companies) accept liability for loss or damages incurred as a result of a person acting in reliance of this publication. Liability limited by a scheme approved under Professional Standards Legislation.

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