Victorian land tax and rent relief measures during COVID-19.

On 23 April 2020, the Victorian Parliament passed the State Taxation Acts Amendment (Relief Measures) Bill 2020 to allow the Commissioner for State Revenue to implement emergency tax relief measures in response to COVID-19. This legislation gives effect to the recently announced land tax relief scheme, which provides for rental relief in certain circumstances for tenants affected by COVID-19.

What are landlords’ entitlements under the scheme?

Victorian landlords that provide rental relief to tenants affected by COVID-19 may be eligible for a 25% discount as well as payment deferral until 31 March 2021 in respect of the land tax for that property.

What are the eligibility requirements?

A commercial landlord is eligible for land tax relief if they demonstrate:

• all or part of their property is leased;
• at least 1 of their tenants (affected tenant):
  • has a reduced ability to pay rent due to COVID-19;
  • has an annual turnover of up to $50 million; and
  • is eligible for the Australian Government’s JobKeeper Payment; and
• they have provided at least a 25% discount on rent to the affected tenant.

Alternatively, landlords may be eligible for land tax relief if they can demonstrate all or part of their property is available for lease and they are unable to secure a tenant due to COVID-19.

Next steps.

Eligible landlords will be able to apply for land tax relief from 1 May 2020.

It is in the best interests of both landlords and affected tenants to adopt a cooperative approach to benefit from this incentive, including facilitating discussions and providing relevant documentation.

Tenants and landlords should also consider their overarching obligations under the mandatory Code of Conduct for commercial tenancies.

Need assistance?

Our Leasing team is available to help you compile and review relevant information and negotiate and formalise temporary arrangements regarding rental relief and lease variations.

For details of all of our COVID-19 tips and updates, visit the Bespoke COVID-19 Hub.