Land tax in NSW is an annual state tax on the unimproved value of land you own in New South Wales, assessed by Revenue NSW on your holdings at midnight on 31 December each year. For the 2026 tax year, you pay nothing if your total taxable land value is $1,075,000 or below. Above that, you owe $100 plus 1.6% of the value over the threshold, and a higher rate applies once your holdings pass $6,571,000.1Revenue NSW. Land Tax Thresholds and Rates Your home is generally exempt. Trusts and foreign owners are treated much more harshly than individuals.
Whether You Owe It
Liability is fixed by what you own at one moment: midnight on 31 December of the year before the tax year. Sell on 30 December and you’re out; hold on 1 January and the full year’s bill is yours.2Revenue NSW. What Is Land Tax?
The tax reaches individuals, companies, and trustees who hold a legal interest in taxable NSW land. Revenue NSW adds together the value of every parcel you own across the state, including your share of any jointly held property, then compares that combined figure to the threshold. Three investment blocks that each sit under the threshold on their own can still produce a bill once they’re aggregated.
Thresholds and Rates for 2026
Both thresholds were frozen in the 2024–25 State Budget, so the 2026 figures match 2024:1Revenue NSW. Land Tax Thresholds and Rates
- General threshold, $1,075,000 to $6,571,000: $100 plus 1.6% of the value above $1,075,000.
- Premium threshold, above $6,571,000: $88,036 plus 2% of the value above $6,571,000.
Two examples show how it lands. Taxable land of $1,500,000 attracts $100 plus 1.6% of $425,000, which is $6,900. A $8,000,000 portfolio attracts $88,036 plus 2% of $1,429,000, which is $116,616.
How Your Land Value Is Set
Land tax is charged on the unimproved value — the site alone, ignoring any buildings, renovations, or landscaping. The NSW Valuer General sets that value as of 1 July each year by reference to sales of comparable vacant land.3Revenue NSW. How Land Tax Is Calculated
Revenue NSW then averages three years to smooth out market swings. For 2026, the average uses the values determined on 1 July 2023, 1 July 2024, and 1 July 2025. If the parcel was created less than three years ago through subdivision or amalgamation, only the years since its creation are averaged.3Revenue NSW. How Land Tax Is Calculated Averaging can hold your taxable figure below the current spot value in a rising market, but it also means your liability won’t fall immediately after a correction.
Exemptions That Keep You Out of the Net
The most common exemption is the principal place of residence. It applies where the land is residential, you use and occupy it as your main home, and you own at least a 25% interest.4Revenue NSW. Land Tax Exemption for Principal Place of Residence5NSW Legislation. Land Tax Management Act 1956 No 26
Land used primarily for commercial farming, grazing, or other primary production is also exempt, provided the dominant use is production carried on with the purpose of making a profit.6Revenue NSW. Land Tax Exemptions and Concessions A hobby farm with no meaningful commercial activity won’t clear the bar.
Other exemptions cover registered boarding houses meeting rental and management standards, charitable and religious organisations using land for their non-profit purposes, aged care facilities and childcare centres, and caravan parks and clubs.
Exemptions aren’t applied automatically. You need to claim them, and you must tell Revenue NSW when the use changes. Turning your home into a rental strips the principal place of residence exemption straight away, and failing to notify can produce back-assessments with interest.
Trusts Pay Differently
Land held through a trust is where NSW land tax gets expensive. Revenue NSW splits trusts into fixed trusts, concessional trusts, and special trusts, and the category decides whether any tax-free threshold applies.
Special trusts, which include most family trusts, discretionary trusts, and many unit trusts, get no threshold at all. They pay a flat 1.6% on the whole taxable land value from the first dollar, rising to 2% above the $6,571,000 premium threshold.7Revenue NSW. How Trusts Are Assessed for Land Tax On land valued at $800,000, an individual owner pays nothing because the value sits below the general threshold, while a special trust owes $12,800.
Fixed trusts and concessional trusts may be treated like individual owners for threshold purposes, but only if they meet the criteria in the Land Tax Management Act 1956. If your trust doesn’t clearly qualify, sorting that out before buying property through it is a lot cheaper than fixing it after an assessment lands.
Surcharge for Foreign Owners
Foreign persons who own residential land in NSW pay an additional 5% surcharge on the unimproved value, with no tax-free threshold. It applies from the 2025 land tax year onwards and sits on top of any standard land tax.8Revenue NSW. What Is Surcharge Land Tax?
You count as foreign unless you’re an Australian citizen, or a permanent resident who has been in Australia for at least 200 days in the calendar year. A permanent resident who spends long stretches overseas can trip the surcharge. Foreign corporations, where foreign persons hold a substantial interest, and trusts with any foreign beneficiaries can also attract it.8Revenue NSW. What Is Surcharge Land Tax?
One boundary worth flagging: the principal place of residence exemption does not apply to surcharge land tax. Even if the property is your home, a foreign person still receives a surcharge assessment.9Revenue NSW. The Principal Place of Residence Exemption
Registering and Paying
If you own NSW land that might exceed the threshold, register with Revenue NSW. You’ll need to disclose every property interest you hold in the state along with your ownership percentage for each parcel. List properties you believe are exempt as well, so Revenue NSW sees the full picture; leaving one off doesn’t shrink your liability, it just pushes the bill later with interest added.
Access to the online portal uses a Client ID and Correspondence ID from any recent Revenue NSW letter.10Revenue NSW. Download Land Tax Assessment Notices If you’ve never had correspondence, request a login through the Revenue NSW website. A MyServiceNSW Account lets you view assessments, pay, and set up payment plans.11Service NSW. Manage Your Land Tax With a MyServiceNSW Account
Once your assessment notice arrives with its due date, you can pay by BPAY, credit card, or through the online portal. Extended payment plans over several instalments are available for larger bills.11Service NSW. Manage Your Land Tax With a MyServiceNSW Account
Objecting to Your Assessment
If the assessment looks wrong — an incorrect land value, a missing exemption, an ownership error — you have 60 days from the issue date on the notice to lodge a formal objection.12Revenue NSW. Lodge a Land Tax Objection Late objections are sometimes accepted, but you’ll need to explain the delay.
You can lodge online through Revenue NSW’s objection form, or by emailing objection@revenue.nsw.gov.au with your Client ID, contact details, reasons, and supporting evidence. If the dispute is about the land value itself rather than the tax calculation, you can object directly to the NSW Valuer General; most valuation objections are resolved within 90 days, and further appeals go to the Land and Environment Court within 60 days of the final decision.13NSW Government. How to Object to a Land Valuation and How We Review This
You still have to pay by the due date while an objection is pending. Revenue NSW refunds overpayments if you win, but it won’t waive interest on a late payment because a dispute was on foot.12Revenue NSW. Lodge a Land Tax Objection
What Non-Compliance Costs
Interest runs daily from the day after the due date until you pay. For the first quarter of 2026 the rate is 11.65%, and it rises to 11.96% for April through June. The rate combines a market component with a fixed 8% premium, so it’s well above a typical mortgage rate.14Revenue NSW. Interest and Penalty Tax
Revenue NSW can also impose penalty tax on top. No penalty applies if the default was beyond your control or you took reasonable care. Up to 30% applies if you failed to take reasonable care but didn’t intentionally disregard the law. Intentional disregard attracts between 15% and 90%, depending on whether you disclosed voluntarily and whether you hindered any investigation.
Interest may be reduced in narrow circumstances such as natural disasters or postal delays, but financial hardship alone isn’t grounds. Penalty tax can be reduced by up to 80% for a voluntary written disclosure made before an investigation starts.14Revenue NSW. Interest and Penalty Tax If you’ve made a mistake, the cheaper move is to raise it before Revenue NSW does.