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Cutback on tax incentives relating to vacant land
From 1 July 2019, the Government will remove the ability for individuals and corporations to claim deductions for expenses associated with holding vacant land. The Government has introduced the measure allowing it to add $50 million to the budget's line and to curb the practice of 'land banking' (i.e the practice of holding land with the expectation that it will increase in value at a later date).
The Government did announce exemptions for vacant land owned to carry out a business, including a business relating to primary production. No exemptions have been announced for land that is being held by developers whilst development approvals are being obtained. In this regard, the Urban Development Institute of Australia (UDIA) has expressed concerns that developers could be unfairly punished for holding vacant sites which have long development approval times.
This publication does not deal with every important topic or change in law and is not intended to be relied upon as a substitute for legal or other advice that may be relevant to the reader's specific circumstances. If you have found this publication of interest and would like to know more or wish to obtain legal advice relevant to your circumstances please contact one of the named individuals listed.
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