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.
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 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.
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