Land tax by state in 2026: what investors actually pay on top of stamp duty

Land tax is the silent investor bill. It is payable every year you hold the property, calculated on unimproved capital value rather than market price, and structured so a single second dwelling in NSW can push annual cost past $5,000 before the council rates notice arrives. Most owner-occupiers never see it. Most investors with more than one property eventually do, and the bill is usually larger than they expected. The rules change every state line you cross, and the thresholds drift each year as state revenue offices reset their land-value baselines.

The figures in this article are indicative for the 2026 assessment year. State revenue offices publish updated schedules annually, and the unimproved-land valuations that drive each assessment are themselves revised on a rolling cycle. Treat the numbers as a planning anchor, not a quote. Always check the current schedule with Revenue NSW, the State Revenue Office of Victoria, the Queensland Revenue Office, or the equivalent in your jurisdiction before signing anything.

What land tax actually is

Land tax is a recurring state tax on the unimproved capital value (UCV) of land you own. Unimproved means the value of the dirt itself, ignoring the dwelling, the landscaping, and any structural improvements. A $1.4 million house on a $900,000 block is taxed on the $900,000, not the $1.4 million. The valuer-general in each state sets UCV figures, usually annually, and the revenue office bills against the figure that applied on the assessment date (most states use 31 December of the preceding year, Victoria uses 31 December).

Every state and territory except the Northern Territory levies land tax. The Northern Territory does not. The principal place of residence is exempt in every state that levies it, which is why most owner-occupiers never encounter the bill. Investment properties, holiday homes, commercial holdings, and most vacant land are not exempt, and the assessment aggregates across everything you own in that state.

Aggregation: why two properties cost more than twice one

The trap inside every state schedule is aggregation. The revenue office adds up the UCV of every taxable parcel you own in that state, then applies the rate schedule to the total. A single $700,000 block might sit comfortably below the NSW threshold and attract nothing. Two $700,000 blocks aggregate to $1.4 million, cross the threshold, and attract land tax on the portion above it.

Aggregation is per owner, per state. Properties owned jointly are assessed on the joint owners as a single taxpayer, with a separate threshold from each owner's individual holdings. Properties held in different trusts are usually treated as separate taxpayers, but most states apply a punitive trust surcharge that more than offsets the extra threshold. Properties owned across state lines are not aggregated against each other; a NSW investor with a Queensland property is assessed twice, once by each state, on the relevant local holdings.

State-by-state, approximate 2026 figures

The schedules below are indicative for the 2026 assessment year. Each state publishes its own calculator and the official figure on assessment is the only one that matters at the cheque-writing stage.

• NSW: general threshold around $1,075,000, premium threshold around $6.57 million. Above the general threshold, the rate is roughly 1.6% of the value above the threshold plus a fixed $100. Above the premium threshold, the marginal rate steps up to about 2%. Foreign-person surcharge is around 5% on residential land. There is also a separate trust surcharge regime where most non-fixed trusts lose the threshold entirely.
• VIC: threshold around $50,000 for the general regime, with a marginal schedule that climbs through bands. By the time aggregated VIC land hits $1 million, the bill is in the low thousands; by $3 million it is comfortably five figures. Victoria also runs a separate Vacant Residential Land Tax and a Windfall Gains Tax on rezoned land, both layered on top. Absentee owner surcharge is around 4%, and the trust surcharge imposes a lower threshold and higher marginal rates.
• QLD: threshold around $600,000 for individuals, $350,000 for companies and trusts. Marginal rates begin at roughly 1% above the threshold and step up through bands. Foreign-owner surcharge is approximately 2%. Queensland abandoned its proposed national-aggregation rule in 2022, so interstate holdings do not currently lift your Queensland assessment.
• WA: threshold around $300,000. Marginal rates start low and climb through bands that get steeper above roughly $1 million in aggregated WA land. WA does not currently levy a general foreign-owner land tax surcharge, though a foreign buyer duty surcharge applies at purchase.
• SA: threshold around $755,000 for individuals. South Australia reformed its trust rules in 2020 and now applies a higher marginal schedule to trust-held land unless beneficial interests are notified. The top marginal rate sits near 2.4% on aggregated land above roughly $1.35 million.
• TAS: threshold around $125,000. Tasmania's threshold has been lifted twice in recent years off a previously very low base, and the rate schedule is comparatively flat. A foreign-investor surcharge of roughly 2% applies on residential land.
• ACT: the ACT does not levy land tax in the same form as the states. Instead it runs a quarterly land tax on rented residential properties (anything not the PPOR and rented out) calculated on AUV, with no threshold. The ACT is also progressively replacing stamp duty with higher general rates, which complicates direct comparison.
• NT: no land tax. The Northern Territory does not levy this tax at all.

Two patterns repeat across the country. Thresholds tend to drift upward with general land values, but more slowly, so the real population of taxpayers widens each year. Surcharges on foreign owners, absentee owners, and trustees of non-fixed trusts have generally trended up since 2017, and several states now apply them at rates that can exceed the underlying land tax.

A worked NSW example

Take a NSW investor holding two investment properties, each with an unimproved land value of $900,000. Neither is a principal place of residence. Combined UCV is $1.8 million. The general threshold is around $1,075,000, so the assessable amount is the difference: $1.8 million minus $1,075,000, which is $725,000.

Applying the approximate NSW rate of 1.6% on the value above the threshold, plus the fixed $100, gives roughly $11,700. That is the annual NSW land tax bill, payable every year the holdings sit in this shape. A third $900,000 property would push aggregated UCV to $2.7 million; the bill would rise by another $14,400 or so, because the entire third block's land value is now above the threshold and taxed at the same marginal rate. The marginal cost of the third property is materially larger than the marginal cost of the second, even though the underlying values are identical.

If the same investor were a foreign person, the NSW foreign-owner surcharge of about 5% on residential land would apply on top, calculated on the full residential UCV rather than the amount above the threshold. On $1.8 million of residential land that is another $90,000 a year, dwarfing the underlying land tax.

A worked Victorian example

A Victorian investor holding a single investment property with an unimproved land value of $600,000 sits well above the $50,000 general threshold. Under the VIC schedule, the bill on aggregated land of $600,000 sits in the low thousands, roughly $2,000 to $2,500 depending on where the brackets land in the 2026 reset. The same investor holding two such properties aggregates to $1.2 million; the bill climbs into the $6,000 to $8,000 range, with the marginal rate higher in the upper bands.

Add the Victorian absentee owner surcharge of around 4% on the full assessable amount if the investor is not ordinarily resident in Australia. Add the Vacant Residential Land Tax if either property sits empty for more than six months in a calendar year. The Victorian schedule starts lower than NSW but the layered surcharges can push effective rates higher than the headline schedule suggests.

Trusts and the surcharge problem

Discretionary trusts were once a standard vehicle for property investors, partly because they offered flexibility on distributions and partly because each trust counted as a separate taxpayer for land tax purposes. Most states have since closed that path with trust surcharges. In NSW, most non-fixed trusts lose the general threshold entirely and pay land tax from the first dollar of land value. In Victoria, trust-held land attracts a lower threshold and a steeper rate schedule. South Australia applies a similar regime unless beneficial interests are notified to RevenueSA.

The structural punchline is that the old threshold-multiplication strategy via trusts is dead in most states. Specific exemptions still apply to fixed trusts, certain unit trusts, and excluded trusts (typically deceased estates and superannuation trusts). Anyone modelling a trust structure for an investment property should price the surcharge into the holding cost before committing, and should pair the analysis with broader strategy questions in the SMSF property investment guide where the same surcharge logic intersects with super-fund rules.

Mitigation, within the rules

There are legitimate ways to manage land tax exposure, and there are aggressive structures that the various revenue offices have spent the last decade closing down. The legitimate ones are usually unspectacular and worth the effort anyway.

• PPOR claim: ensuring your principal place of residence is correctly registered as such removes it from the assessable pool entirely. Mistakes here are common when someone moves and forgets to update the revenue office.
• Cross-border diversification: aggregation is per state, so a $700,000 block in NSW and a $700,000 block in Queensland will each sit below their respective state thresholds, where two $700,000 blocks in NSW would aggregate above the NSW threshold.
• Joint ownership structuring: joint ownership creates a separate taxpayer for assessment purposes, with its own threshold, though the secondary-deduction rules in each state prevent double-counting against the individual owners. Get specific advice on this one. It is common ground for revenue-office reassessment.
• Land value composition: a unit on a small share of land carries less aggregated UCV per dollar of purchase price than a house on a large block. The same gross investment value can attract very different land tax depending on the land-to-improvement ratio.
• Objections: each state allows formal objection to the valuer-general's UCV assessment within a window after the notice. When the UCV looks materially out of line with comparable nearby blocks, an objection is cheap and sometimes successful.

Modelling land tax into a buy decision

Land tax sits in the holding-cost line of any investor model, alongside council rates, insurance, management fees, and repairs. Stamp duty is one-off; land tax is forever. On a property held for ten years, cumulative land tax often exceeds the initial stamp duty bill, especially in NSW and Victoria where rate schedules are steeper and surcharges layer on top. A proper modelling exercise prices both. The stamp duty calculator handles the up-front side; the rental yield calculator gives you the income line to set the holding costs against. The negative gearing calculator lets you stress-test the after-tax cash flow once land tax, interest, and depreciation are netted into the picture.

Two related articles fill in the rest of the holding-cost picture. The breakdown of landlord tax deductions covers what comes off the assessable rental income at federal tax time, and the stamp duty NSW vs VIC comparison walks through the up-front state cost the same two jurisdictions impose on entry.

The annual cadence

Land tax notices arrive once a year, usually in the first half of the calendar year for the relevant assessment year. The figure is calculated on ownership as at 31 December of the previous year, which means a sale in November shifts the entire next-year bill to the buyer, while a sale in January leaves the seller carrying it. Settlement adjustments normally apportion the bill between the parties on a pro-rata basis, but the legal liability still sits with the owner of record at the assessment date. Sellers in late December and buyers in early January should both check the adjustment line at settlement.

What to do before signing on the next property

Three checks worth running before settlement, every time.

• Pull the current UCV for the property from the state valuer-general's portal. Add it to your existing aggregated UCV in that state. Run the revenue office calculator with the new total. The difference is your incremental annual land tax.
• Check whether the trust or company you intend to buy through triggers a surcharge in the state of purchase. If it does, model the holding cost with the surcharge applied.
• If you are not ordinarily resident in Australia, check the foreign-person and absentee-owner surcharges. They are often the dominant cost component for non-resident investors and can shift the yield calculation by several percentage points.

On Burbfinder, suburb and region pages show the local price and rent context, and the calculators translate a specific purchase into an after-cost yield. Land tax is one of the few investment costs that rises with neither inflation nor effort; it rises with land values, and land values rise faster than thresholds in most years. Anyone holding for the long run should price that drift into the model rather than the current schedule alone.