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Changes to recovery of land tax from tenants
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The Queensland Treasurer, Mr Andrew Fraser introduced the Revenue and Other Legislation Amendment Bill (2009) on 3 June 2009 (Bill). The Bill amends several existing laws, in particular the Land Tax Act (1915) (Act).
The Act currently states that a provision in a lease entered into after 1 January 1992 which requires a tenant to pay land tax or reimburse the owner for land tax is unenforceable. The Queensland Government proposes to retain this restriction for residential and retail leases only so that parties to all other leases will be free to negotiate as to who will pay land tax.
This change will bring Queensland into line with other states in Australia.
The Bill contemplates that the change will only apply to leases which are entered into after 30 June 2009. Consequently, the Bill will not affect:
The Bill is strongly supported by the Property Council of Australia, which has actively lobbied for the ability of owners to pass on land tax to tenants for several years. The Treasurer has indicated that, for the time being, the Government is not prepared to consider amending the Retail Shop Leases Act and the Residential Tenancies Act to allow owners to recover land tax from retail and residential tenants.
If you have any questions as to how these changes may affect you or would like us to review your leases, please contact Cameron Graham.
The Queensland Treasurer, Mr Andrew Fraser introduced the Revenue and Other Legislation Amendment Bill (2009) on 3 June 2009 (Bill). The Bill amends several existing laws, in particular the Land Tax Act (1915) (Act).
The Act currently states that a provision in a lease entered into after 1 January 1992 which requires a tenant to pay land tax or reimburse the owner for land tax is unenforceable. The Queensland Government proposes to retain this restriction for residential and retail leases only so that parties to all other leases will be free to negotiate as to who will pay land tax.
This change will bring Queensland into line with other states in Australia.
The Bill contemplates that the change will only apply to leases which are entered into after 30 June 2009. Consequently, the Bill will not affect:
- a lease signed on or prior to 30 June 2009 (existing lease);
- a renewal of an existing lease through the exercise of an option to renew; or
- an assignment or transfer of an existing lease.
The Bill is strongly supported by the Property Council of Australia, which has actively lobbied for the ability of owners to pass on land tax to tenants for several years. The Treasurer has indicated that, for the time being, the Government is not prepared to consider amending the Retail Shop Leases Act and the Residential Tenancies Act to allow owners to recover land tax from retail and residential tenants.
If you have any questions as to how these changes may affect you or would like us to review your leases, please contact Cameron Graham.