Here’s everything you need to know about Victoria’s latest property tax, Windfall Gain Tax (WGT).
WGT is a new Victoria State Government based tax occurring on rezonings after 1st July 2023 (originally drafted start date was 1st July 2022). The tax is aimed at land which results in a taxable value uplift to the land of more than $100,000.
The taxable value uplift is based on the capital improved value that evaluates both the land and any improvements including buildings if applicable – in contrast to land tax, which looks at site value alone.
You have an industrial zone land package valued at $400,000 immediately prior to rezoning. The land is rezoned to be a neighbourhood residential zone and your land package is now valued at $600,000 at the same date.
This uplift of $200,000 is what will be liable to WGT.
Triggered at the time of rezoning, the State Revenue Office will issue an assessment notice with payment details within 30 days of issue. Opportunity within this 30-day payment period to elect to defer your tax in full or partially to meet your cash flow needs.
Deferral will be up until 30 years or upon a sale or transfer of the land. Please note, there will be interest applicable on deferred payment.
Any land in Victoria that is rezoned will be subject to WGT. There are a range of exemptions and exclusions but the main two that may apply to you are:
The rezoning must be changed between schedules not within the same zones. Refer back to our previous example of industrial zone to neighbourhood residential zone – rather than another scenario like neighbourhood schedule 1 to neighbourhood schedule 2 zones.
Within two months of receiving the notice of assessment you can lodge a valuation objection.
Timing is crucial! The Commissioner does not have discretion to allow late valuation objections.
Issues to note:
If you feel this may be applicable to you, there’s no time like the present to contact us to evaluate your situation. Get in touch here.
Whilst working from home for the self-employed has been commonplace for years, the number of employees working from home has boomed over the last couple of years for a reason we’re all well aware of: covid. For many, this change will remain permanent – whether it’s for the full five days, or on a part time basis with flexible working arrangements now a mainstay of Australian employment.
Cryptocurrency has fast become a popular investment and payment method in Australia however all too often the decision to purchase doesn’t come hand in hand with the necessary tax knowledge. Here’s everything you need to know about cryptocurrency.
The Australian Taxation Office (ATO) releases information regarding its areas of emphasis for tax returns each year. For 2023, these include rental property deductions, work-related expenses, and capital gains tax.
In 2020 during the COVID-19 pandemic, the government raised the immediate asset write off threshold to $150,000 for small businesses using the simplified depreciation rules then brought in Temporary Full Expensing (TFE), allowing many eligible businesses to claim an immediate deduction for depreciable assets. This measure was extended to 30 June 2023. After several years of such generous write offs, this is set to come to an end on 30 June 2023.
Subscribe to our monthly newsletter for industry updates, important information and advice for business owners.