How Is Land Tax Calculated on Investment Properties in Victoria in 2026?
Victoria taxes land above $50,000 in value, plus a COVID-19 debt surcharge on top. Here's how the current thresholds and bands work, as at July 2026.
How Is Land Tax Calculated on Investment Properties in Victoria in 2026?
[REVIEW: to be reviewed by a registered tax agent — arranged by
]
Land tax is an annual state government tax charged on the total value of land you own above a threshold — it’s separate from council rates, stamp duty and income tax. In Victoria, most owner-occupied homes are exempt, which is why land tax mainly shows up for people who own an investment property. The figures below are current as at July 2026 and are reset most Victorian Budgets, so treat them as a snapshot, not a permanent number.
Tax outcomes depend on your circumstances — speak with a registered tax agent before acting.
How is land tax calculated on an investment property in Victoria?
Victoria charges land tax on the total taxable value of all the Victorian land you own that isn’t exempt (not on each property separately). For most individual and company owners, the general threshold is $50,000 of total taxable Victorian land value — nothing is payable below that. Land valued at exactly $50,000 attracts a $500 minimum assessment. Above the threshold, State Revenue Office (SRO) Victoria applies its own progressive rate scale to work out the dollar amount owing.
Total taxable Victorian land value (add up all your non-exempt Victorian land) → compare it to the relevant threshold → SRO Victoria’s current rate scale gives the base land tax → add any surcharge band that applies (see below) → that’s your total assessment.
This article doesn’t reproduce SRO’s full bracket-by-bracket rate scale above $50,000, because it’s exactly the kind of figure that changes at a state budget — SRO Victoria’s current land tax rates page always has the version that applies right now. That page states that land tax is calculated using the site value of your land, as determined by the Valuer-General Victoria, based on what you owned as at midnight on 31 December of the year before the assessment year — so the figure feeding the calculation is a government-set valuation, not a number you supply yourself. A registered tax agent or SRO Victoria directly can confirm how your specific property’s value was arrived at.
Victorian land tax at a glance — as at July 2026
| Threshold or scheme | Figure | Who it applies to |
|---|---|---|
| General land tax threshold | $50,000 of total taxable Victorian land value (nil below; $500 minimum at exactly $50,000) | Most individual and company owners |
| Trust surcharge threshold | $25,000 (nil below) | Land held on trust |
| COVID-19 debt temporary surcharge | Flat $500–$975, plus 0.10 percentage points at the top band | Layered on top of the general threshold above |
| Vacant Residential Land Tax (VRLT) | 1% / 2% / 3% of Capital Improved Value, no tax-free threshold | Vacant residential land — a separate tax, not part of the thresholds above |
Source: SRO Victoria current-rates pages, cited throughout this article. Both the general and trust thresholds are legislated to apply for the 2024–2033 land tax years, including 2026.
Is my home included, or just my investment property?
Every Australian state and territory generally exempts a genuine principal place of residence from ordinary land tax — the mechanics of that test differ from state to state, but the underlying idea is the same everywhere: your own home is treated differently from land you hold for other purposes. An investment property, by definition, isn’t your home, so it doesn’t get that exemption — which is exactly why an investment property is often the piece of land that tips an owner over the threshold in the first place.
Does it make a difference if the property is held in a trust or company?
Yes, at least at the threshold level. Land held on trust faces its own trust surcharge threshold of $25,000 — lower than the general $50,000 threshold — and trust land tax surcharge rates start from that point. This is a separate scheme from the COVID-19 debt surcharge below; the specific trust surcharge rate scale itself isn’t reproduced here, so check SRO Victoria or a registered tax agent for how it applies to your structure.
More broadly, individual, company, trust and self-managed super fund (SMSF) ownership each carry materially different tax consequences — not just for land tax, but for income tax and capital gains tax too — and no ATO or Moneysmart page ranks one structure as universally better. Which structure suits your situation isn’t something this article can answer for you.
Tax outcomes depend on your circumstances — speak with a registered tax agent before acting.
What is the Victorian COVID-19 debt temporary land tax surcharge?
On top of the general threshold above, Victoria layers a temporary surcharge — introduced via the State Taxation Acts Amendment Act 2023 (Vic) and applying from the 2024 land tax year — that SRO Victoria states is “legislated to apply until 30 June 2033” (covering the 2024–2033 land tax years, with non-temporary settings due to resume from the 2034 land tax year).
| Taxable Victorian land value | COVID-19 debt surcharge |
|---|---|
| Below $50,000 | None — below the general threshold |
| $50,000 to under $100,000 | Flat $500 |
| $100,000 to under $300,000 (under $250,000 for land held on trust) | Flat $975 |
| $300,000 or more ($250,000 or more for land held on trust) | $975 flat, plus an extra 0.10 percentage points added to the land tax rate |
This surcharge sits on top of — not instead of — the general land tax worked out from the threshold and rate scale above. Full detail is on SRO Victoria’s COVID debt repayment plan page.
Does the calculation change for a vacant property?
Yes — but it’s a genuinely separate tax, not an adjustment to the figures above. Victoria’s Vacant Residential Land Tax (VRLT) applies to residential land that wasn’t actually used or occupied as a home, or under a genuine lease, for more than six months of the preceding calendar year. It’s assessed on the property’s Capital Improved Value (CIV) rather than site value, and it has no tax-free threshold at all — every dollar of CIV counts once the property is caught.
Current rates are 1% of CIV in the first year a property is liable, 2% in a second consecutive year, and 3% in the third and any later consecutive year. From 1 January 2026 it also reaches some undeveloped land and unsold new residential stock in defined circumstances.
Common exemptions include using the property as a genuine holiday home for at least four weeks a year, a significant renovation that both started and finished within the preceding calendar year, and a change of ownership (settlement, not just signing a contract) during the preceding calendar year. Full detail — including how the six-month vacancy test and each exemption work — is on SRO Victoria’s VRLT page and exemptions page.
Are there extra surcharges for foreign or absentee owners?
There’s an important distinction here that’s easy to blur. Victoria charges an 8% foreign purchaser additional duty — but that’s a one-off stamp duty charged at the time a foreign person buys the property, not an ongoing land tax. Separately, Victoria’s absentee owner surcharge is the ongoing land tax add-on: it applies to people who own Victorian land but live outside Australia (depending on visa status — it doesn’t apply to Australian citizens or permanent residents living overseas), layered on top of the general land tax or trust surcharge amount worked out above. As at July 2026, the rate is 4% for the 2024 land tax year onward, up from 2% between 2020 and 2023, and it isn’t payable at all below the $50,000 general threshold (or $25,000 trust threshold). The purchase-duty rate and the ongoing land tax surcharge remain two different charges under two different rules — check SRO Victoria’s absentee owner surcharge page or a registered tax agent for how it applies to you.
Does owning property in other states affect my Victorian land tax?
No — and this is worth understanding early, because it surprises a lot of first-time investors. Land tax is set state by state, not federally. There’s no national land tax and no single combined threshold; each state and territory runs its own Act, its own revenue office and its own threshold. Only your Victorian landholdings count toward the Victorian thresholds above.
Owning property in another state doesn’t add to (or subtract from) your Victorian figure — it simply creates a separate assessment under that state’s own rules. For scale, New South Wales’s general land tax threshold is $1,075,000 of combined taxable NSW land value (frozen since the 2024-25 NSW Budget) — a very different number from Victoria’s, because it’s a different tax base entirely. Never assume one state’s threshold or scale applies to land in another state.
Where can I check the exact figure for my own property?
Every figure in this article is a snapshot as at July 2026. Land tax thresholds, surcharge bands and VRLT rates are reset at state budgets, so before you rely on a number for your own tax planning, check SRO Victoria’s current rates page for what’s current, and confirm your own position with a registered tax agent.
Tax outcomes depend on your circumstances — speak with a registered tax agent before acting.
The bottom line
For most Victorian investment property owners, the starting point is the $50,000 general threshold, with a $500 minimum once you hit it. On top of that sits a COVID-19 debt surcharge that adds a flat dollar amount (and, above $300,000, an extra rate loading), land held on trust has its own lower $25,000 surcharge threshold, and a genuinely vacant residential property can trigger the separate VRLT with no threshold at all. None of these figures are fixed forever — they move with Victorian Budgets, which is exactly why this piece anchors everything to “as at July 2026” rather than stating a number as permanent.
If you’re weighing land tax as one line item in the wider cost of holding an investment property, our guide to what property investment involves in Australia covers the broader mechanics, costs and risks. And if land tax is changing how a negatively geared purchase stacks up against other approaches, our piece on cash-flow positive versus negatively geared property is a useful next read.
General information only. This article provides general information and does not take into account your objectives, financial situation or needs. It is not financial product advice, tax advice or legal advice. Consider whether the information is appropriate for your circumstances and seek advice from a licensed professional before making financial decisions. MyBrix Pty Ltd ABN 37 669 479 636 is authorised representative 1304961 of Australian Financial Licensing Group, AFS Licence No. 269868. Brix are issued by MyBrix Properties Pty Ltd ACN 669 491 338. Before acquiring or selling Brix, read the Product Disclosure Statement and Target Market Determination available at mybrix.com.au.
