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Amongst other things, the Act contains provisions which set out when land owned subject to a trust is:

  • exempt from land tax;
  • liable for the either the trust or general land tax rates; and
  • subject to aggregation with other land or assessed separately.

Trustees must notify RevenueSA within one month of certain changes occurring with respect to trust held land. These requirements are outlined below.

The following discussion sets out how trusts will be assessed for land tax.

Land subject to a trust that is excepted or exempted from land tax

Land that is exempt from land tax under the Act is not liable to land tax, including where the land is subject to a trust. Accordingly, land that is exempted from land tax will not be included in the taxable value of land in an assessment of a land tax liability.

The following discussion therefore proceeds on the basis that any land fully exempted from land tax will not be included in any assessment of a land tax liability.

Separate assessment of trust land

Other than where expressly provided for, pursuant to Section 11, where an owner is the owner of land as trustee of a trust (other than a trust arising because of a contract to purchase or acquire an estate or interest in the land), the trustee is to be assessed land tax on the whole of the land subject to the trust as if the land were the only land owned by the trustee.

This means that where an interest in land is held on trust, either by a trustee or trustees jointly (where two or more people own an interest in a parcel of land as trustees for the same trust, they will be treated as a single owner), the taxable value of the interest in the land:

  • will be aggregated with the taxable value of all other land owned by the trustee(s) that is subject to the same trust (except where the trust is an excluded trust); but
  • will not be aggregated with the taxable value of other land owned by the same owner in its own capacity, or as trustee of a different trust.

Example 5

land held on trust

Sam owns:

  • land as the trustee of the First Trust (total taxable value of $500,000);
  • land as the trustee of the Second Trust (total taxable value of $600,000);
  • land with Alex both as trustees of the Third Trust (total taxable value of $650,000); and
  • land that is not subject to a trust (total taxable value of $700,000).

None of the land that Sam is an owner of is subject to aggregation. Sam will receive four separate assessments for the:

  • land owned as trustee of the First Trust (total taxable value of $500,000), calculated using the trust rates (unless a nomination is made);
  • land owned as trustee of the Second Trust (total taxable value of $600,000), calculated using the trust rates (unless a nomination is made);
  • land owned together with Alex as trustees of the Third Trust (total taxable value of $650,000), calculated using the trust rates (unless a nomination is made);
  • land that is not subject to a trust (total taxable value of $700,000), calculated using the general rates.

Trust rates of land tax

Pursuant to Section 8A(1a), land held on trust for a fixed, discretionary or unit trust is generally assessed at the trust rates of land tax, unless a notice of the beneficial interest(s)/unit holdings or a designated beneficiary is in place (discussed further below) (Sections 8A(1b)(a), (b) or (c) for fixed trusts, unit trust schemes and discretionary trusts respectively).

The trust rates of land tax do not apply to land held by:

  • an excluded trust (Section 8A(1b)(d));
  • an implied, constructive or resulting trust (Section 13E);
  • public unit trust schemes, being either a listed trust or a widely held trust (Section 8A(1b)(e)); or
  • a corporation that holds land in its capacity as trustee of a trust and that corporation is grouped with one or more related corporations that own land and land tax is assessed in accordance with Section 13J (Section 8A(1c)), that is, in the case of related corporations arising pursuant to Section 13G(5) (discussed further below).

An exclusion from the higher trust rates does not exempt land from land tax. Instead, the general rates of land tax rates will apply.

The trust rates of land tax will apply where the land held on trust has a total site value greater than  $25,000, where a notice of beneficial interest(s)/unit holdings or a designated beneficiary is not in place.

Where the trust rates of land tax apply, land tax is payable on the full value of the land held on trust (i.e. as though there was no tax free threshold). Land tax will not be payable though until the total value of the land held on behalf of the trust exceeds $25,000 (note that pursuant to Section 6, where the total amount of land tax payable by any taxpayer in respect of any year would be less than $20, no land tax is payable by the tax payer).

The trust rates incorporate an additional 0.5% on top of the general land tax rates for land holdings valued below the top marginal tax threshold.

When the total value of the taxable land exceeds the highest land tax threshold, the general and trust land tax rates are the same, with the rates being capped at the top marginal tax rate of 2.4%.

Trustees, at most, will pay an additional $6,452 for the 2020-21 financial year due to the higher rates of land tax applicable to trust held land.

A trustee has the option to notify RevenueSA of a designated beneficiary, beneficiaries or unitholders of a trust (for discretionary, fixed and unit trusts respectively).

Where a notice of beneficial interest(s)/unitholdings is in place, the trustee will not be liable for the higher trust rates of land tax. The trustee will instead be assessed at the general rates and the beneficiaries or unitholders, who will also be considered an owner (though not to the exclusion of the trustee), will be assessed for their interest in the trust held land in any individual assessments they receive.

Trustee notification requirements

Other than where land has been exempted from land tax by the Commissioner of State Taxation (the “Commissioner”), trustees must notify RevenueSA by 31 July 2020 that they own South Australian land on trust (unless they have previously notified RevenueSA that they are a trustee of land for the purposes of the Act and have received confirmation from RevenueSA that RevenueSA has recognised that the owner holds the land in their capacity as trustee of a trust).

Notifications can be provided via the RevenueSA Online portal available at www.revenuesaonline.sa.gov.au/login or by completing the Notification of Land Held on Trust form.

If a person does not have access to a computer or someone that can provide assistance, they can contact RevenueSA on 8226 3750 (option 2) for an alternative method.

In addition, trustees must notify RevenueSA within one month where the following occurs:

  • they become a trustee of a trust that land is held on behalf of, including where they are already a trustee and acquire further land as trustee;
  • the circumstances change so that proper grounds for an exemption from land tax cease to exist in regards to trust held land;
  • they dispose of any land subject to the trust if the disposal does not result in any change in the legal ownership of the land;
  • anything happens that results in the trust to which the land is subject becoming a different category of trust (being any of a fixed trust, a unit trust scheme, a discretionary trust, an excluded trust or a public unit trust scheme), e.g. a discretionary trust becomes a fixed trust;
  • there is a change in the beneficial interest(s) of a fixed trust, where a notification of beneficial interest is in force;
  • there is a change of unit holdings in a unit trust, where a notification of unit holdings in the trust is in force;
  • where a corporation is the trustee of a fixed trust or a unit trust scheme and a corporation becomes, or other related corporations between them become, the owner of more than 50% of:
    • where corporation 1 is the trustee of a fixed trust—the total beneficial interests in land subject to the trust; or
    • where corporation 1 is the trustee of a unit trust scheme—the total number of units held by the unit holders in the scheme;
  • the administration of a deceased estate that includes land in South Australia is completed; or
  • where notification has not been provided previously by the trustee of an administration trust – probate being granted or letters of administration having been issued.

Failing to notify within the required time limit may give rise to a tax default under the Taxation Administration Act 1996. When this happens, the trustee may be liable for interest and penalty tax on the additional amount that would have been assessed if the trustee had notified within the required time.

Taxing trusts

There are different land tax considerations for different trust types or scenarios:



Implied, constructive or resulting trusts

An implied, constructive or resulting trust is not intentionally created but is imposed by law or arises in certain circumstances.

A trustee of an implied, constructive or resulting trust will be:

  • separately assessed on all trust held land at the general rates of land tax; and
  • assessed as if the trust held land was the only land owned by the trustee.

Example 10

land held on trust

Sam owns two parcels of land. Following a dispute between Sam and Alex, a court has ordered that Sam holds one of the parcels of land on trust for Alex.

Accordingly, Sam will be:

  • separately assessed on the land held on trust for Alex at the general rates of land tax, as opposed to the trust rates of land tax; and
  • assessed as if the trust held land was the only land owned by Sam, such that it will not be assessed together with the other parcel of land Sam owns.

Public unit trust schemes (listed trusts or a widely held trusts)

Trustees of public unit trust schemes being either listed trusts or widely held trusts, will be assessed on the whole of the land subject to the trust at the general rates of and tax (and not the trust rates of land tax) as if the land were the only land owned by them.

A listed trust is a unit trust scheme some or all of the units in which are quoted on a recognised financial market, being a financial market operated by the Australian Securities Exchange Limited or a financial market of a stock exchange prescribed by the Stamp Duties Regulations 2013.

A widely held trust has the same meaning as that term would have in the Stamp Duties Act 1923 if a reference in Section 97(1) of that Act to “300 unitholders” were a reference to “50 unitholders” (in summary, a widely held trust is a unit trust scheme which has not less than 50 unitholders none of whom, individually or together with any associated person, is entitled to more than 20% of the units in the trust).

Testamentary trusts

A testamentary trust arises where property of a deceased person is held by a personal representative or trustee, but only once the personal representative or trustee is actually holding the property. It is generally established as part of a will and is created to hold and safeguard some or all of a deceased person’s assets for the benefit of others.

A testamentary trust may only arise once an administration trust ends (see above for discussion on administration trusts).

A testamentary trust does not qualify as an administration trust, such that it is not capable of being an excluded trust and in the first instance is to be assessed at the trust rates of land tax.

Whether a testamentary trust is a fixed trust or a discretionary trust is dependent on the terms of the particular testamentary trust.

A trustee of a testamentary trust that is a fixed trust (i.e. the beneficiaries are fixed, along with their proportional interest in the trust) can notify RevenueSA of all the beneficiaries of the trust.

The results of notifying are discussed above. In particular, if land constitutes the PPR of all the beneficiary(ies), they may be entitled to exemption from land tax on the land where the requirements are met.

If a testamentary trust is instead a discretionary trust, the trustee may notify RevenueSA of a beneficiary who will be the designated beneficiary of the trust, subject to meeting the various requirements.

Key requirements here include that the land needs to have been subject to the testamentary trust as at midnight on 16 October 2019. RevenueSA also needs to be notified of the designated beneficiary by 30 June 2021 (please refer to the discussion above for further information in this regard).

The results of notifying are discussed above. In particular, if land constitutes the PPR of the designated beneficiary, they may be entitled to an exemption from land tax on the land where the requirements are met.

Related corporations who are trustees

Where a corporation is a trustee, the land held by that corporation as trustee will not be subject to the related corporation provisions found in Part 3, Division 6, “Grouping of Related Corporations”. Instead, the land will be assessed in accordance with the trust provisions as discussed above.

There is one exception to the above though, which is discussed below.

Part 3, Division 6 provides for corporations to be related corporations in certain circumstances.

Where two or more corporations that own land are related corporations, they are to be jointly assessed for land tax on the land as if it were owned by a single corporation. The general rates of land tax will also apply, as opposed to the trust rates of land tax.

For fixed or unit trusts with a corporation as trustee, Section 13G(5) provides that corporations are related corporations if one of the corporations (corporation 1) is the trustee of a fixed trust or a unit trust scheme (the trust) and another corporation (corporation 2) owns, or other related corporations between them own, more than 50% of—

  • the total beneficial interests in land subject to the fixed trust; or
  • the total number of units held by the unit holders in the unit trust scheme.

Section 13G(5) will apply to land owned by:

  • corporation 1 as trustee of the trust; and
  • corporation 2 in its own right and not solely as trustee of a trust (discussed further below).

Where Section 13G(5) applies and there are two or more related corporations that both own land that are to be jointly assessed for land tax on the land pursuant to Section 13J, the corporate trustee cannot give notice of the unitholders/beneficiaries of the trust.

In this regard, Section 13G(5) expressly provides that where the provision is enlivened, such corporations are related corporations. If Section 11 (and the further ability to give notice of the unitholders/beneficiaries of the trust pursuant to Sections 12 and 13) were to instead apply, such that land owned by a trustee of a trust was instead to be assessed separately and not aggregated and assessed pursuant to Division 6, then the express inclusion of Section 13G(5) (so as to provide that corporations are related corporations in such circumstances) would be rendered ineffective.

Sections 13J(5) to (11) however set out the means by which a related corporation can be exempted from the application of Division 6.

However, where corporation 2 owns land as trustee of a trust, Section 11 will apply to any land corporation 2 owns as trustee of a trust, such that the land will not be included in the joint assessment for land tax.

If there is only one related corporation that owns land, land tax cannot be assessed pursuant to Section 13J.

As such, where Section 13G(5) applies and a corporation that owns land is not a related corporation of any other corporation that owns land, it will not be assessed for land tax pursuant to Section 13J, and instead only the owner of the land will be assessed (either at the general rates of land tax or at the trust rates of land tax where the land is owned subject to a trust). Please refer to the related corporations information for further information regarding related corporations.


Example 11

Corporation A is the trustee of a unit trust scheme.

Corporation B owns 60% of the units in the unit trust scheme.

Neither Corporation A or Corporation B are related corporations of any other corporation.

As Corporation B owns more than 50% of the total number of units held by the unitholders in the unit trust scheme, Corporation A and Corporation B are related corporations.

If both corporations own land, with Corporation A owning land as trustee of the trust and Corporation B owning land in its own right, they are to be jointly assessed for land tax at the general rates of land tax on the land as if it were owned by a single corporation.

However, if only one of the corporations owns land, the land would not be jointly assessed for land tax.

If only Corporation A owned land, unless a notice of beneficial interest(s)/unitholding(s) or a designated beneficiary is in place, as Corporation A owns the land as trustee of a trust, it would be assessed for land tax at the trust rates of land tax and not the general rates of land tax.

If only Corporation B owned land, Section 13J would not apply and they would not be jointly assessed for land tax.

Illustration showing corporation A as trustee and Corporation B holding 60% of the units or beneficial interest in trust


Impact of notification of beneficiaries outside of the Act

Where the Act provides for a beneficiary or unitholder to be an owner of the land for the purposes of the Act (i.e. where they are a notified beneficiary/unitholder or designated beneficiary), the extent by which they are taken to own land as a result is limited to the Act only.

For example, the beneficiary or unitholder will not be taken to have:

  • been conveyed or transferred an interest in land for the purposes of the Stamp Duties Act 1923, such that a liability to stamp duty arises; or
  • a relevant interest in residential property for the purposes of the First Home and Housing Construction Grants Act 2000, such that they will remain eligible for a grant where the eligibility requirements are met; or
  • become an owner of the land such that there are Federal taxation, benefit or other consequences.

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