If you are undertaking a substantial renovation or rebuild of your existing home, you may be eligible for an exemption from land tax for up to 2 financial years while the building work is undertaken.

What land can receive the exemption?

The exemption may apply to land that contains your previous principal place of residence which you have moved out of to undertake substantial renovations or rebuild.

The exemption may also apply to land you have bought and intend to occupy as your principal place of residence once building work is complete.

Can I get the exemption on any property being renovated or rebuilt?

No, the exemption only applies to a property which:

  • prior to the renovation/rebuild was your principal place of residence and, once building work is complete, will again be your principal place of residence, or
  • you are renovating or building, that will become your principal place of residence upon completion.

To be eligible, the land must meet the principal place of residence exemption criteria when you move in.

View more information on the principal place of residence exemption.

What is a principal place of residence?

A principal place of residence is where the land (home):

  • is the primary residence of the owner(s);
  • is the owner(s) usual residence; (that is, where they undertake their normal living activities, such as eating and sleeping);
  • is occupied on an ongoing basis, that is, occupation is not merely transitory or an intention to occupy; and
  • has buildings which are predominately residential in nature.

View more information on the principal place of residence exemption.

What if there are two or more owners?

Where a property is owned by two or more persons, only one of them must meet the principal place of residence exemption criteria once they move in.

If the residing owner only owns an interest in the property of less than 50%, they may not be eligible for an exemption where the residing owner holds an interest of:

  • 5% or less, unless the Commissioner is satisfied that the resident’s interest was not for a purpose related to the reduction of the amount of land tax payable; or
  • between 5% and 50% and the Commissioner has formed the opinion that the resident’s interest was created to reduce the amount of land tax payable.

Can a company receive this exemption?

To be eligible for an exemption the property must be owned by a natural person.

If the property is owned by a company, an exemption cannot apply, even where the property is occupied by a director of the owner company.

If the property is jointly owned by a natural person and a company, an exemption may apply if the natural person lives in the home as their principal place of residence and all other criteria are met. However, if the natural person (residing owner) only owns an interest in the property of less than 50%, they may not be eligible for an exemption where the residing owner holds an interest of:

  • 5% or less, unless the Commissioner is satisfied that the resident’s interest was not for a purpose related to the reduction of the amount of land tax payable; or
  • between 5% and 50% and the Commissioner has formed the opinion that the resident’s interest was created to reduce the amount of land tax payable.

Can I use any portion of the land for business or commercial purposes?

An exemption may apply depending on how much of the total floor area of all buildings (including sheds, garages etc.) on the land is used for business or commercial purposes (other than the business of primary production), which includes the rental of any part of the land or the buildings upon the land.

If less than 25% of the total floor area of buildings is used for a business or commercial purpose, a full exemption will apply.

If more than 25% of the total floor area of buildings is used for a business or commercial purpose, the exemption will not be available.

How long must I live in the property after building works have been completed?

After the renovations or building works are completed, you must live in the home as your principal place of residence for at least 12 months.

What happens if I live in another home I own while repairs/rebuild is being undertaken?

You may only receive one principal place of residence exemption.

However, if you move into another property that you own while the renovation or building works are occurring, you can choose which property the exemption will be applied to (that is, you can choose either the home being renovated/rebuilt or the home that you are physically living in).

If you are renting or living with relatives or friends, the exemption will apply to the home being renovated/rebuilt.

Example 1

Jim and Janette decide to knock down their existing home and rebuild. They move out of the property in March and into rental accommodation for the duration of the rebuild.

Their home is knocked down in April and building of the new home commences in July. Building is completed in 18 months and they move back in to the property the following February, almost two years after they moved out.

Jim and Janette continue to live in the new home for the next 12 months.

The land would normally have been subject to land tax for 2 financial years, however in this example an exemption will apply for both of those financial years.


Example 2

Deb and Terry decide to undertake a substantial renovation of their existing home. They move out of the property in March and into another property that they own for the duration of the rebuild.

They decided to apply for a residential exemption on the property they have now moved into, therefore their former residence will be liable for land tax while the rebuild is occurring.

Once they move back into the newly built home, they can apply for an exemption on the new home, and the home they were living in while renovating will become taxable.


What if I purchase a new property which I intend to renovate or rebuild and occupy as my principal place of residence?

If you purchase a property that you want to renovate or rebuild prior to moving in, you may still be eligible for the exemption.

The same criteria applies.

For how long will I receive the exemption?

The exemption will apply for a maximum of 2 financial years.

How do I apply for an exemption?

You can apply online. (Select Principal place of residence as the property type option that best describes the use or circumstances of the property.)

Before you commence your application, you will need:

  • Your ownership number. This can be found in the top right hand corner of your land tax or emergency services levy notice of assessment.
  • The assessment number of the subject property. This can be found on your land tax or emergency services levy notice of assessment, water rates or council rates notice.
  • Supporting documentation, such as a copy of: Schedule 19A or Certificate of Partial Completion to show that the build works have been completed.

What if renovations/rebuilding isn’t completed within the 2 years?

We recognise that there can be obstacles to completing renovations or building works within the 2 year time frame.

Contact us if you think you will not meet the timeframe to discuss your options. The Commissioner of State Taxation has the discretion to extend the required timeframes where failure to comply arises from exceptional circumstances outside of your control.