In a recent decision the New South Wales Supreme Court held that although the subject land had been purchased for future residential development, during the years relevant to the disputed Land Tax assessments, the dominant use of the land related to cattle-grazing operations under an agistment agreement. The taxpayer property developer was therefore eligible to apply the exemption applicable to land used in primary production in s 10AA(2) of the Land Tax Management Act 1956 (NSW).
Equivalent statutory exemptions apply in Victoria under Div 2 of Part 4 of the Land Tax Act 2005 (Vic) where land is “used solely or primarily for the business of primary production”.
The decision highlights the importance of demonstrating the purpose for which the land is used over a given assessment period in order to successfully establish the application of the primary production land exemption .
If you have any queries on how Land Tax exemptions can apply or require assistance in applying for an exemption, please contact: