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Property tax is an annual tax which eligible first home buyers were able to opt into under the First Home Buyer Choice initiative for eligible purchases between 11 November 2022 and 30 June 2023.
Property tax 2024-2025 notice of assessments
The property tax 2024-2025 notice of assessments will commence issuing from 1 July 2024. Your notice will be issued via your chosen communication preference (email/post). To update your communication preference, please complete the property tax online enquiry form.
For more information on how to pay your notice of assessment and your alternative payment options including what you need to do if you are experiencing hardship, visit the pay your property tax page.
How is property tax calculated?
The annual property tax liability will be based on the land value of the opted-in property (at the beginning of the previous financial year).
Both the fixed component and land value rate will be indexed annually, starting 1 July 2024 as per Schedule 2 of the Property Tax (First Home Buyer Choice) Act. This ensures the average property tax payment rises in line with average incomes.
The fixed component and land value rate are calculated using the Gross State Product Per Capita/Land Value Indexation factors for the current financial year.
Year
2024 Gross State Product Per Capita Indexation factor
Land Value Indexation factor
2024
1.094633
0.968094
2023
Not Applicable
Not Applicable
2022
Not Applicable
Not Applicable
Examples of how these indexation factors are used for the calculation of property tax can be found below.
The fixed component for a financial year is calculated by multiplying the fixed component of the previous financial year by the Gross State Product Per Capita Indexation factor for the financial year.
Fixed component amount for a financial year = Fixed component amount for the previous financial year x Gross State Product per capita indexation factor for the financial year
The land value rate is calculated by multiplying the land value rate for the previous financial year by the Gross State Product Per Capita Indexation factor for the financial year and dividing by the land value indexation factor for the financial year.
Land value rate = Land value rate for the previous financial year x Gross State Product per capita indexation factor for the financial year ÷ Land value indexation factor for the financial year
Property tax 4% cap
A 4% cap was legislated to provide assurance to first home buyers who opted into property tax, that their annual liability for a particular lot of land will not increase by more than 4% – even if their land value increases by more than this margin. To be eligible for the 4% cap, the property must have been used for the same purpose for at least a portion of the previous year (owner occupied/not owner occupied).
Being a pro rata tax, this can result in a 4% cap being applied to a property tax liability for all or part of a financial year depending on changes in land use from one year to the next, and the number of days the land use applies.
The 4% cap is not applicable for the first year of paying property tax as there is no previous year’s calculation to apply the cap to.
Revenue NSW will determine whether the current year’s liability is lower than the previous year’s (inclusive of the 4% cap that has been applied), and a Notice of Assessment is issued for the lesser liability of the two.
Where the ownership and land remain consistent from one financial year to the next, if the included owner:
has the same land use for the entire current financial year as they had in the previous year, they will receive the full benefit of the 4% cap. (See below Fig 1.1 and 1.2)
changes their land use for the entire current financial year as compared to the previous year, they will not receive the benefit of the 4% cap. (See below Fig 2.1 and 2.2)
changes their land use partway through the current financial year, they will receive the benefit of the 4% cap only for the portion of the year where the land use is the same as they had in the previous year. (See below Fig 2.3 and 2.4)
has both classes of land use in the current and previous financial year, the 4% cap will be applied on each usage. (See below Fig 2.5)
Note: There are some differences in the way the 4% cap applies where the land is mixed use, or has been subdivided or consolidated.
Single use and change of use
Single use
Figure 1.1
Previous year
Current year
Land use
Days
Land use
Days
4% cap
Owner occupied
365
Owner occupied
365
Applicable
Figure 1.2
Previous year
Current year
Land use
Days
Land use
Days
4% cap
Not owner occupied
365
Not owner occupied
365
Applicable
Change of use
Figure 2.1
Previous year
Current year
Land use
Days
Land use
Days
4% cap
Not owner occupied
365
Owner occupied
365
Not applicable
Figure 2.2
Previous year
Current year
Land use
Days
Land use
Days
4% cap
Not owner occupied
365
Owner occupied
365
Not applicable
Figure 2.3
Previous year
Current year
Land use
Days
Land use
Days
4% cap
Owner occupied
365
Owner occupied
100
Applicable
Not owner occupied
265
Not applicable
Figure 2.4
Previous year
Current year
Land use
Days
Land use
Days
4% cap
Not owner occupied
365
Not owner occupied
165
Applicable
Owner occupied
200
Not applicable
Figure 2.5
Previous year
Current year
Land use
Days
Land use
Days
4% cap
Owner occupied
250
Owner occupied
85
Applicable
Not owner occupied
115
Not owner occupied
280
Applicable
Land value FY 2022/23: $1,000,000
Usage (days of the year)
Base annual liability
Pro rata liability (i.e. based on current usage and inflated land value)
Owner occupied - 200
$400 + ($1,000,000 x 0.003%) = $3400
$1863.00
Not owner occupied - 165
$1500 + ($1,000,000 × 0.011%) = $12,500
$5650.70
4% cap on above figures (used for 2024 FY): Owner occupied - $3536 Not owner occupied - $13,000
Total payment: $7513.70
Land value FY 2023/24: $1,100,000
Usage (days of the year)
Base annual liability
Pro rata liability (i.e. based on current usage and inflated land value)
4% increase on prior year pro rata for current year (i.e. dependant on previous year’s usage and independent of inflated land value)
Owner occupied - 100
$3,700 (a)
$1011.00 (e)
$966.10 (g)
Not owner occupied - 266
$13600 (b)
$9,884.20 (f)
$9448.10 (h)
4% cap on above figures (used for 2025 FY): Owner occupied - $3,848 (c) Not owner occupied - $14,144 (d)
Pro rata total payment: $10,895.20
4% Pro rata total payment: $10,414.20
For the FY 2023/2024, the pro rata total of $10,895.20 is higher (based on inflated land value) than the 4% pro rata total of $10,414.20 (based on a 4% increase on the previous year’s usage, dependant solely on the current year’s usage and independent of inflated land value). Payment will always be the lesser, in this case the capped 4% pro rata total, that is $10,414.20.
Here we look at the same scenario as above, however the land value has inflated less, at 4.05% (to $1,040,500) FY 2023/24.
Usage (days of the year)
Base annual liability
Pro rata liability (i.e. based on current usage and inflated land value)
4% increase on prior year pro rata for current year (i.e. dependant on previous year’s usage and independent of inflated land value)
Owner occupied - 100
$3,521.50 (a)
$962.15 (e)
$966.10 (g)
Not owner occupied - 266
$12,945.50 (b)
$9,408.45 (f)
$9448.10 (h)
4% cap on above figures (used for 2025 FY): Owner occupied - $3,662.40 (c) Not owner occupied - $13,463.40 (d)
Pro rata total payment: $10,370.60
4% pro rata total payment: $10,414.20
Now the pro rata total of $10,370.60 is lower than the 4% pro rata total amount of $10,414.20. As land inflation has not been sufficient to overcome the 4% pro rata total capping, amount due will again be the lesser, $10,370.60.
If you are liable for property tax, you will be issued a notice of assessment on or after 1 July. The assessment period covers the financial year from 1 July to 30 June.
You will receive a notice of assessment for property tax every year until the property is sold. If you need to change your personal information for the issuing of the notice, you can Manage your property tax details online.
Check Your notice of assessment
Make sure the following details on your notice of assessment are correct:
The recorded property usage
Any special treatments applied
If any information is wrong, update it using the property tax online formbefore the due date on your notice.
Your payment options and instalment dates are listed on the notice. You don't need to make any payments until at least 30 days after the notice is issued. For more information on how to pay your property tax, visit the Pay your property tax page.
Manage your property tax details online
You can use the property tax online enquiry form to advise Revenue NSW of a change in your circumstances that may impact your property tax liability. This includes:
There may be circumstances where an owner is absent from their owner-occupied land due to unavoidable circumstances, or for a temporary period after which the first home buyer intends to return. In certain instances, the owner may not return such as moving into a nursing home.
A special treatment can be provided in certain cases to enable the land to continue to be taxed at the owner-occupied rate.
These include:
Person in full time care
If an included owner is in full-time care and immediately prior to their entry into care they owned the land and the land was owner-occupied, the land will continue to be treated as owner-occupied. No income can be derived during this time except for an excluded residence or amounts reasonably necessary to cover land related costs of the land.
For example, Jim lived in his own home for the last 5 years, which has been treated as owner-occupied for property tax purposes. He recently moved into and now resides at an aged care establishment while being provided with residential care. Jim’s son moved into the property as caretaker and pays all the council, energy and water rates as well as the home insurance. As Jim does not derive income from the land, the owner-occupied rate of tax will continue to apply for so long as these circumstances continue.
Absence from principal place of residence
If an included owner is absent from their land but immediately prior to their absence they owned the land, and the land was owner-occupied, the land will continue to be treated as owner-occupied. The absence cannot be longer than 3 years. Within 12 months of the included owner’s return they must resume occupation for a continuous period of 6 months. No income can be derived during this time except for an excluded residence or amounts reasonably necessary to cover land related costs of the land such as a caretaker. In addition, the included owner cannot use and occupy another residence they own during the time they are absent from their land receiving the special treatment.
For example, Jill had been paying property tax at the owner-occupied rate. The following year she moves overseas for work and rents a flat. Provided she does not receive income, except to cover land related costs or an excluded residence, the land will be treated as owner occupied for up to 3 years from when she moved out.
Before residence requirement is satisfied
When an included owner becomes the owner of the land, they must move into the home within 12 months and live in it continuously for 6 months. The owner-occupied rate will be applied from the date of settlement to when the included owner moves in provided no income has been derived during this time.
For example, if John takes ownership of his home on 1 August 2023, John will have until 31 July 2024 to move into the property and must then reside in it as his principal place of residence for a continuous period of at least 6 months.
If John moves into the home in June 2024, he will be taxed at the owner-occupied rate, even during the period of 1 August 2023 and June 2024, provided that he does not derive any income from the land during that period.
By completing the Property Tax Application Form, you declare that the property is intended to be used as your principal place of residence and will be granted special treatment as owner-occupied unless and until you advise that the above criteria are not satisfied.
Unoccupied land to be used as a principal place of residence owner
Land that is continuously unoccupied due to construction or renovations will be treated as owner-occupied. The duration of this special treatment is up to 5 years however, certain conditions must be met. No income can be derived during this time and neither the included owner or their family can use and occupy another residence they own during the time.
Within the first 2 years of the special treatment being applied, works will need to have physically commenced or significant steps taken to allow physical works to commence. The included owner will need to commence lawful occupation of the land for a continuous period of at least 6 months within 1 year after the building works are completed.
For example, Jack purchased vacant land in the previous year with the intention of building his property. In the current year he lodges a Development Application and building works commences in the second year following settlement of his purchase. Construction of the property is completed by the end of the fourth year and Jack moves in and continues to reside in the property for 6 months. For the period of time between settlement of the purchase to moving into the property, Jack was residing in his parent's home. His land will be treated as owner-occupied from when he first purchased the land as he has met all necessary requirements.
By completing the Property Tax Application Form, you declare that the property is intended to be used as your principal place of residence and will be granted special treatment as owner-occupied unless and until you advise that the above criteria are not satisfied.
Apply for special treatment
If your circumstances conform with the eligibility criteria outlined above and you would like to apply for a special treatment of certain land, please use the property tax online enquiry form.
Those who opted into property tax instead of the upfront transfer duty, will pay an annual property tax for as long as they own the property. If you sell this property, you are responsible to advise Revenue NSW of your pending settlement date. Property tax is a pro rata tax, which means your liability is calculated proportionately to the number of days you own the property.
If you have exchanged contracts on your property, please advise us of the proposed settlement date by completing the property tax online enquiry form.
In the additional details section of the form please provide:
A request for a pro rata quote
Your settlement date
If you have sold your property, in addition to the above-mentioned requirements, you are also required under the legislation to provide a property tax status certificate. Please see Selling your property for more information.
It is important to keep your contact details up to date to ensure you receive your property tax notifications to your preferred address.
Did you know you can opt in for electronic delivery for your notice of assessments?
To opt into digital delivery for your property tax notice of assessments, or to update your contact details, please complete the property tax online enquiry form.
There are substantial penalties for providing false or misleading information to Revenue NSW. We regularly check your information against data from other government agencies and businesses.
Objections and reviews
You can lodge a formal objection if you believe we have applied the legislation incorrectly. You must lodge the objection within 60 days of the issue date of an assessment or decision.
The objection form can be accessed below. Please note that this form should not be used for land value objections.
Land values used in property tax notices of assessment are obtained from the NSW Valuer General. Only the Valuer General has the authority to ascertain land values and determine objections relating to land valuation matters.
If your objection concerns land valuation matters, go to the Valuer General’s website to get an objection kit.
The Valuer General will consider your objection, inform you of the decision, and any rights of review or appeal you may have.
If there has been an alteration to the land value, the Valuer General will notify us and your property tax liability will be reassessed based on this new value. You’ll be sent a new property tax notice of assessment.
A status certificate will need to be requested when selling a property. There will be no changes to the existing process to apply for a certificate. The application you submit will provide for both land tax and property tax. No additional charge will be applied.
After a request is submitted via the Client Service Provider, Revenue NSW will perform checks to determine if a land tax or property tax liability exists for that landowner,
a joint response will be issued for both taxes, and
the landowner or their representative can then contact Revenue NSW where a certificate is issued as 'Not Clear' for Land Tax or 'opted in' for property tax to arrange clearance
If the property being sold is under contract, you must apply for a certificate and give the buyer a copy at least 14 days before the contract completion date. For contracts completing within 14 days, the buyer must be given a copy on the date that the contract is made.
If the vendor owns three lots in one strata plan, they’ll be processed under one certificate. If more than three lots are involved, you’ll need to lodge more than one certificate.
Note: The equity partner is liable to pay a proportion of the usual transfer duty, under the Duties Act 1997, based on the percentage interest in the property they are acquiring.
Eligible purchaser/Included owner
The owner who has elected to pay property tax.
Full time care
In an aged care establishment, a building or part of a building used by an approved provider under the Aged Care Act 1997 of the Commonwealth for the provisions of respite care of residential care.
Principal place of residence
The one place of residence of a person, whether within or outside Australia, that is the primary residence of that person.
Spouse
The person to whom the applicant is legally married or living with as a couple in a de facto relationship as defined in the Interpretation Act 1987.