Victorian State Budget Key Announcements

The 2020-21 Victorian State Budget was handed down this week. The main tax related announcements are:

New Jobs Tax Credit 

Businesses with annual wages less than $10 million will receive a payroll tax credit of 10 cents for every dollar of taxable Victorian wages paid in 2020-21 and 2021-22 above the previous year’s wages. This is a non-refundable offset so at most it will offset the payroll tax liability for the year, it will not result in a refund.

Payroll tax threshold increase

From 1 July 2021, the threshold for paying payroll tax annually will be increased from $40,000 to $100,000. This means that business with an annual payroll tax liability of less than $100,000 can choose to pay on an annual basis rather than a monthly basis.

Land transfer duty waiver

A land transfer duty waiver of 50% will apply for purchases of new residential properties (and 25% for existing residential properties) for contracts entered into between 25 November 2020 and 30 June 2021. This relief applies to properties with a dutiable value of up to $1 million and is over and above existing concessions.

Commercial and industrial land transfer duty concession

The regional Victoria 50% commercial and industrial land transfer duty concession will be brought forward to apply to contracts entered into from 1 January 2021 (rather than 1 July 2023 as per the 2019-20 Budget).

Build-to-rent sector in Victoria

Under Victoria’s Big Housing Build program, a 50% land tax discount will be available for eligible new build-to-rent developments from 1 January 2022 until 2040. These developments will also be exempt from the Absentee Owner Surcharge over the same period.

Navigating your way through the announcements and how they apply to you can be complicated.

If you have any queries, please email: admin@patrickrowan.com.au or contact your Accountant directly via email and we will be in touch.