Navigating land tax can be a challenge, especially when every part of Australia handles it differently. Affordability, combined with solid population growth and steady employment, has made the Canberra property market an attractive place for investors.
While it is easy to be swept up in the excitement of buying rental property and finding a tenant, it is important to stay across your financial obligations beyond maintenance and repairs. Land tax is a state-imposed charge on the value of land, excluding any structures.
This guide explains who pays land tax, who’s exempt, how it’s calculated, when to pay and importantly, how to effectively plan.
Who pays land tax in the ACT?
In the ACT, land tax is assessed quarterly and made up of a fixed charge and a valuation charge. This is different from other states, where it is an annual charge.
Land tax applies to properties not deemed as the principal place of residence. This includes rental homes, granny flats, vacant properties and those owned by a trustee.
Money collected by the ACT Government through land tax is used to fund essential community services. It is essential to inform the Commissioner for ACT Revenue if you own a property that is liable for land tax. Use this Lax Tax Notification form here.
Who is exempt from paying land tax in the ACT?
The good news is that not all land is subject to this tax, with some exemptions. It is not payable on:
- Principal place of residence
- Moving from one residence to another
- Deceased estates are exempt for up to two years
- Properties unfit for occupation
- Retirement homes
- Not-for-profit housing associations
- Rural land
In the ACT, most land tax exemptions are self-assessed. It is up to the owner to determine their liability and inform the Government.
Commercial properties do not incur land tax in the ACT. However, they are subject to other costs, such as a fixed charge and a valuation-based charge for general rates.
How is land tax calculated in the ACT?
Land tax is assessed quarterly and is made up of a fixed charge and a valuation charge.
From July 1 2025, the fixed charge is $1693. The variable charge is calculated on its unimproved value over up to 5 years.
Rental dwellings on the same property as your home, such as a granny flat, may incur land tax.
Click here to get an idea of how much land tax you may be liable to pay.
When do you pay lax tax in the ACT?
There are four land tax assessment dates in the ACT. These are:
- 1 July
- 1 October
- 1 January
- 1 April
Land tax can be paid via direct debit, online, EFT, BPay or at the post office.
If you are struggling to make payments, alternative arrangements can be made by contacting ACT Revenue.
LJ Hooker is here to help
When you are ready to start or add to your property portfolio in ACT, be sure to contact your nearest LJ Hooker agent. They are specialists who are experienced in helping people looking to get started in investing and can access property databases and valuation tools.
Importantly, they understand the ACT investment market and can also arrange for an experienced property manager to take care of the property. This reduces the burden on you as a landlord and will allow you to focus on growing your portfolio. Don’t forget to be a tax-smart investor by getting all your documentation in order from the start. This includes knowing what expenses can be claimed, your tax obligations and declaring all rental-related income in your annual return.
DISCLAIMER - The information provided is for guidance and informational purposes only and does not replace independent business, legal and financial advice which we strongly recommend. Whilst the information is considered true and correct at the date of publication, changes in circumstances after the time of publication may impact the accuracy of the information provided. LJ Hooker will not accept responsibility or liability for any reliance on the blog information, including but not limited to, the accuracy, currency or completeness of any information or links.
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