Thousands of SA land tax bills yet to be issued for 2020-21 financial year

Thousands of property owners could be hit with two land tax bills in just months, as the Treasurer confirms major “complexities” delayed 13,500 assessments.

Thousands of land tax bills for this financial year are still yet to be issued, stoking fears property owners will be slapped with multiple bills in quick succession.

A total of 13,500 land tax bills for the 2020-21 financial year, the first to include controversial aggregation changes, were due to be sent out late last year.

However, Treasurer Rob Lucas revealed system “complexities” had delayed the assessments.

And, if 2021-22 land tax bills arrive on time from October, property owners would be hit with two charges in just a matter of months.

It has prompted Commissioner of State Taxation Julie Holmes to offer “sensible payment arrangements” for affected land tax payers.

“For those who might have an issue and get two bills, then the Commissioner has indicated her willingness to enter into deferred payment arrangements,” Mr Lucas said.

“Some of the (bills) that haven’t been issued won’t need to be issued, because they will be under the threshold, so that’s what we’re still trying to establish.”

Mr Lucas said rebates were available to help property owners transition to the government’s new land tax system.

“Anyone in the first year, who ends up with an increased bill, as a result of our reforms, between $2500 and $102,500 will get 100 per cent of it rebated this year,” he said.

On Friday, Mr Lucas also announced a 12-month extension for trustees to nominate a beneficiary, alleviating some concerns held by the property industry.

“I am advised that RevenueSA has received a number of inquiries from taxpayers relating to the delay in receiving their assessment, noting the importance of receiving this information to assist in deciding whether or not to nominate a beneficiary before the deadline,” he said.

Treasurer Rob Lucas said large rebates were on offer to help owners transition to the government’s new land tax system.

SA Property Council chief executive Daniel Gannon said there was “clearly a level of frustration” among landlords over the delays, but welcomed the extension given to trustees.

“Industry has called for this extension and the Treasurer has listened, which is welcome news for landlords, property owners and financial advisers,” he said.

“Accountants and other financial providers need to see land tax bills before advising landlords and property owners whether they’re eligible for relevant initiatives, which underscores the importance of extending this time frame.”

Only a small number of trustees are among the 13,500 delayed bills.

Controversial reforms that passed parliament in late 2019 mean people who own multiple properties must pay an aggregate rate of land tax on all their holdings, boosting many to the top rate of tax.

Previously, landlords could own numerous properties in separate legal entities and potentially pay land tax at a lower rate.

The move was partially offset by slashing the top rate of tax from 3.7 per cent to 2.4 per cent.

Other changes included reducing the rate for portfolios worth between $755,000 and $1.1m and eliminating tax for properties valued under $450,000.

SA Property Council Executive Director Daniel Gannon called on the government to extend the time frames in which property owners could take advantage of rebates and other assistance.

Chief Executive Pat Gerace said the delays were “less than ideal”.

Urban Development Institute SA chief executive Pat Gerace said: “It’s less than ideal to have a massive change in land tax, where there are some people who are faced with increased land tax bills, to then on top of that have the uncertainty of when the assessments would actually arrive.”

Opposition treasury spokesman Stephen Mullighan blasted the State Government for the latest “bungle”.

“It’s clear the government hasn’t thought through the impacts of these land tax bills – many owners have tenants that have lost jobs or had businesses suffer as a result of COVID-19, and now they are facing huge bills for land tax,” he said.

“These delayed bills are the latest in a series of land tax bungles, including the debacle over the government tax increases in 2019, and the letters of demand sent out to over 370,000 property owners last year during the beginning of the pandemic.”

Mr Lucas said “92 per cent of individuals and 75 per cent of related corporations” would pay less land tax as a result of the reforms.

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