Land Tax on Investment Property by State

How much is land tax on an investment property?

Land tax on an investment property is an annual state tax charged on the unimproved land value you own above a tax-free threshold. It does not apply to your home, since your principal place of residence is exempt. Victoria has the lowest general threshold at just $50,000, and the ACT has no tax-free threshold at all for rental land, so a modest investment property can attract land tax there. By contrast NSW has a high general threshold of $1,075,000, and the Northern Territory has no land tax.

How land tax works in Australia

Land tax is levied by each state and territory revenue office, not the ATO. Key features for 2025-26:

• It is charged on the land value only (the site/unimproved value set by the Valuer-General), not the house or the purchase price.
• Your home is exempt. Land tax mainly hits investment properties, holiday homes and vacant land.
• It is assessed on your combined taxable land in that state at a single date each year, so owning several properties pushes you up the brackets.
• Each state has its own threshold and marginal rate scale. Foreign owners and (in some states) trusts pay surcharges or lower thresholds.

Here are the 2025-26 general (individual, non-trust) thresholds:

State/Territory	Tax-free threshold (general)
VIC	$50,000 (SRO)
ACT	No threshold (charged on all rental land)
WA	~$300,000
QLD	$600,000 (individuals)
SA	~$732,000
TAS	$125,000
NSW	$1,075,000 (Revenue NSW)
NT	No land tax

So the jurisdictions where an ordinary single investment property is most likely to trigger land tax are Victoria and the ACT; NSW and SA have high thresholds that many single properties fall under. Always check your own revenue office, as thresholds and rates change.

Worked example

Say you buy an investment unit with a land value of $400,000 (the building is excluded).

In Victoria (general rate, $300,000–$600,000 bracket: $1,350 + 0.3% of the amount over $300,000):

$1,350 + 0.3% × ($400,000 − $300,000) = $1,350 + 0.3% × $100,000 = $1,650 per year

In NSW (general threshold $1,075,000):

$400,000 is below the threshold, so land tax = $0

Same property, same land value: $1,650 a year in Victoria versus nothing in NSW. Over a 10-year hold that VIC bill is roughly $16,500 (before any rate or value changes), which is real money to factor into your cash flow. That is why land tax sits alongside repayments, council rates and insurance in any honest investment budget.

Model this in True Loan

True Loan is a free calculator that lets you stack land tax on top of your loan so you see the true cost of holding the property, not just the repayment.

1. Open the True Loan calculator and enter your loan amount, rate and term to get the repayment (a $600k loan at 6% over 30 years is about $3,597/month).
2. In the Ongoing costs section, type your estimated annual land tax into the dedicated field, plus council rates, water, insurance, strata, maintenance and property management.
3. If you plan to park cash against the loan, use the Offset balance input (interest accrues on loan minus offset). If instead you'll tip in a fixed amount each month, use the separate Extra repayment ($/month) input; they are two different levers.
4. Use the comparison view to run the same property as if it were in Victoria versus NSW (or owner-occupier versus investment), and watch the ongoing-cost gap.

Every scenario is shareable via its URL, so you can send a buyer's agent or partner the exact numbers.

Common questions and mistakes

Does land tax apply to my own home? No: your principal place of residence is exempt in every state that charges land tax. It mainly applies to investment and vacant land.

Is it based on what I paid? No. It is based on the unimproved land value set by the Valuer-General, which is usually well below your purchase price.

Does my interstate property count? Land tax is assessed per state, so each state only counts the land you hold there. But within a state, your holdings are combined.

Can I claim it back? Land tax on a rental is generally tax-deductible against rental income; check the ATO or your accountant.

Related reading: stamp duty: investment vs owner-occupier, the ongoing costs of owning a home per year, and how much equity you need to buy a second property.

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Figures are estimates for the 2025-26 financial year and thresholds/rates change, so always confirm with your state revenue office and moneysmart.gov.au. This is general information, not financial or tax advice.