Land Tax
The State Revenue Office states that land may be exempt from land tax if it is used and occupied as a registered rooming house, subject to the Commissioner’s guidelines under the Land Tax Act 2005.
Commissioner’s guidelines
The Commissioner’s guidelines for determining whether a rooming house is used and occupied primarily as low-cost accommodation for the purposes of section 75(1)(b) of the Act are as follows:
The types of persons for whom the accommodation must be provided
The exemption applies only to a rooming house which has been occupied primarily by one or more rooming house residents during the year immediately preceding the tax year.
A rooming house resident is a person who:
- has the right to occupy a room, together with a right to use common facilities in the rooming house;
- and is not any of the following:
- a relative (as defined in the Act) of the land owner or manager/lessee of the rooming house; or
- a director or shareholder, or relative of a director or a shareholder of a company if a company is the owner of land and/or operator/lessee of the rooming house; or
- a trustee or beneficiary of a trust if a trustee is the owner of land and/or operator/ lessee of the rooming house.
The circumstances in which, and the arrangements under which, the accommodation is provided
The exemption applies only if, during the year immediately preceding the tax year, at least 80 per cent of the accommodation at the rooming house was occupied by long-term rooming house residents.
A long-term rooming house resident is a rooming house resident who, during the year immediately preceding the tax year, resided at the rooming house for one or more periods totalling not less than three months.
Where this requirement is not met, an owner of land may still be eligible for the exemption. The owner of the land may provide to the Commissioner written reasons explaining why this requirement was not met. In each case, the Commissioner will consider the application on its merits, and may or may not waive this requirement.
Maximum tariffs for the accommodation
The exemption applies only if the tariff charged per rooming house resident for weekly accommodation at the rooming house does not exceed the maximum permitted tariff set by the Commissioner. The maximum permitted tariff for a tax year is based on the gross weekly age pension rate for the previous September quarter (e.g. the maximum permitted tariff for 2022 is based on the gross weekly age pension rate for the 2021 September quarter).
Where full board and lodging is provided, the maximum permitted tariff per rooming house resident in the year preceding the tax year is:
- 105 per cent of the gross single weekly age pension rate for single accommodation, and
- 105 per cent of the gross couple weekly age pension rate (on a per person basis) for shared accommodation.
Where less than full board and lodging is provided, the maximum permitted tariff per rooming house resident in the year preceding the tax year is:
- 70 per cent of the gross single weekly age pension rate for single accommodation, and
- 70 per cent of the gross couple weekly age pension rate (on a per person basis) for shared accommodation.
Single accommodation means accommodation in a room occupied by only one rooming house resident who has the right to exclusively occupy that room. Shared accommodation means accommodation in a room in any other scenario, including:
- by two or more rooming house residents who together have the right to exclusively occupy that room, and
- by one or more rooming house residents who do not have the right to exclusively occupy that room.
The maximum permitted tariff is declared each year and can be found on the SRO website: Rooming houses | State Revenue Office
The website also outlines the information that needs to be provided to apply for a land tax exemption.