Land tax valuations are expected to jump between 2022 and 2023 due to an increase in the general and premium thresholds, paving the way for a subsequent rise in objections to the NSW Valuer-General. The thresholds rose by 18 per cent in 2022, but valuations have been rocketing up by as much as 100 per cent.

Running off a three-year cycle, significant increases are attributed to ‘valuation catch-ups’ where previously undervalued properties are valued much higher to reflect correct values. This runs in combination with falling market prices as a result in the steady increase of interests rates, meaning that assessment notices reflect overstated land values.

While owner-occupiers do not have to pay land tax on their primary residence, investors will bear the brunt, including on holiday homes. It is expected that this will, naturally, result in a radical jump in objections submitted challenging valuations for the current period. In comments made to the AFR in September last year, then-NSW Valuer-General David Parker has advised people to begin collecting local sales data in order to challenge upcoming assessment notices.

Madeleine O’Connor

This material has been produced by Beatty Hughes & Associates for the purposes of providing general information and does not constitute legal advice.