From 1 January 2025, Vacant Residential Land Tax will apply to residential properties across Victoria if they have been vacant for more than six months in the preceding calendar year.

This means that if you own residential property in Victoria that is vacant for more than 6 months in the 2024 calendar year, you may be liable for Vacant Residential Land Tax in 2025. This tax is calculated on the Capital Improved Value (CIV) of the property, not just its calculated land value.

The Vacant Residential Land Tax rates are as follows:

What does ‘Vacant’ mean?

A property is considered vacant if, for more than 6 months in the preceding calendar year, it has not been lived in by:

• the owner or the owner’s permitted occupant, as their principal place of residence (PPR), or
• a person under a lease or short-term letting arrangement.

The following exemptions may apply to you:

• Holiday homes in specific circumstances
• Ownership of the property changed during that year, or
• The property became a ‘residential property’ during that year, or
• The property became a ‘residential property’ during the previous two calendar years, and ownership is unchanged, or
• The owner occupied the property for at least 140 days of that year to attend their workplace or business, and the owner has a PPR in Australia (Homes owned by companies, associations, or organisations are generally not eligible for this exemption).

 Which properties are excluded?

• Unimproved land i.e. land without a residential premises, or
• Commercial residential premises, or
• Residential care facilities, supported residential services or retirement villages, or
• Land in alpine resorts.

Holiday Homes Exemption

Your holiday home may be exempt if it is used for at least four weeks of the year by you or your family and your principal place of residence is in Australia.

Holiday homes owned by a Trust or Company must meet additional criteria for eligibility. The entity must have owned the property as of 28 November 2023 to be eligible for the exemption.

If your property has been vacant for more than 6 months and you believe you are exempt in the calendar year ending 31 December 2024, you are required to notify the Victorian State Revenue Office (SRO) by the 15th of January 2025. 

Applications for exemption to this tax, where applicable, must be made to the State Revenue Office by 15 January 2025.

How to apply?

The exemption application for the 2025 year can be applied directly via State Revenue Office (SRO) online portal here.  You will need your customer number and land tax assessment number.

The exemption is available for one property and need only be applied for once, unless your circumstances change.

There is no substantiation requirement, only a declaration that the exemption is applicable to you and the number of days you spent at the property in the prior year.

For more information or personalised guidance, feel free to contact our team of experts at LZR.