The Surprise Nobody Wants After Buying Property: Land Tax in NSW

Let me tell you a quick story.

I’ve had so many conversations with clients that start out the same way:
They’re excited. They’re building a property portfolio. They’ve found the investment property of their dreams.

And then—bam—someone mentions land tax.

Cue the blank stare.

“Wait… what’s land tax?”
“Nobody told me about that.”
“Why wasn’t this in the brochure when I signed up for the ‘Get Rich Through Property’ seminar?”

I get it. Land tax isn’t sexy. It’s not the thing you’re Googling when you’re shopping for an investment property. But if you don’t know about it, you could end up with a bill you weren’t expecting—and that’s a mood killer for any new property investor.

So, let’s break it down. No jargon, no lectures. Just real talk about what land tax in New South Wales actually is, and when it applies to you.

What Is Land Tax, Really?

At its core, land tax is a state-based tax (in this case, NSW) that kicks in when you own property that’s not your home, and the land value reaches a certain threshold.

The important bit?
It’s based on the land value—not the purchase price of the property.

So if you bought an $800,000 property, but the land component is only $200,000, that $200,000 gets counted toward your land tax “piggy bank.”

Buy another property? Add that land value to the piggy bank too.

When your NSW land holdings (in your personal name) go over just over $1 million in land value, land tax comes knocking.

But My House Is Exempt… Right?

Usually, yes!
Your principal place of residence—aka the home you live in—is typically exempt from land tax.

But if you start buying investment properties, that’s where land tax starts to come into play. And if you’re buying under a trust, company, or super fund, the rules get trickier (and sometimes less friendly).

Why Does This Matter?

Because I see it all the time:

• A client’s accountant says, “Buy property in a trust.”

• A property guru says, “Buy in your personal name—it’s easier!”

• No one mentions the land tax.

• Then you call me, and suddenly I’m the first person to break the news.

It’s not about scaring you off from investing. I’m pro-property! But you need to know the full picture—the costs, the pros, and the cons—before you sign anything.

The Common Exemptions (Keep These in Mind):

Here are a few situations where land tax might not apply:

• Your home (PPR)

• Primary production land (think farms)

• Boarding houses or caravan parks

• Certain types of trusts or super funds (this depends on how they’re set up)

But—and it’s a big but—you usually have to apply for these exemptions. They’re not automatic.

So, What Should You Do?

Before you jump into buying your next property, make sure you’ve had a chat with your lawyer, conveyancer, accountant, and financial advisor.

Ask the real questions:

• Will land tax apply to me?

• What’s the land value of the property I’m buying?

• Should I buy in my personal name, a trust, or a company?

Because trust me—you’d rather have this chat before you get the land tax bill, not after.

Final Thoughts: Real Estate Should Be Exciting, Not Stressful

Buying property is a big deal. It’s meant to be exciting. But part of the excitement comes from being fully informed, so you’re not blindsided by things like land tax later.

If you’re not sure where you stand, or you just want a bit more clarity, listen to the full episode of The StacyM Show—I break it down even more there.

Or better yet?
Book a free call with my team at Aqua Legal & Conveyancing. We’ll help you figure out what applies to you and how to get your ducks in a row before you buy.

🎧 Listen to the Episode:

Land Tax 101: The Property Cost Nobody Warns You About