NSW Land Tax: The 2026 Threshold and Rates

NSW land tax is a yearly tax on the land you own other than your home, charged on its combined value. For the 2026 land tax year nothing is payable up to $1,075,000 of taxable land value, and above that it’s $100 plus 1.6% of the amount over the threshold. Past the premium threshold of $6,571,000 it’s $88,036 plus 2%. Revenue NSW’s own examples put $1,100,000 of land at $500 a year and $1,655,000 at $9,380. It froze both thresholds from 1 January 2025, and the 2026-27 NSW Budget didn’t change them.

It’s land value, not property value. Most people don’t check it. That’s the detail that catches North Shore investors.

How land tax is worked out

Revenue NSW uses the land values the NSW Valuer General sets as at 1 July each year, and it averages the last three years so that one big jump doesn’t hit you all at once. A parcel created more recently, through a subdivision for instance, only counts the years since it existed.

The taxing date is midnight on 31 December, the same night every year, whatever the settlement dates say. Whatever taxable land you own at that moment is assessed for the following land tax year, and the notices start going out in January. It isn’t worked out pro rata, so selling in February doesn’t reduce the year’s bill, and buying on 2 January means nothing is owed on that property until the next taxing date.

Notices for the 2026 year started going out on 19 January 2026. Check yours when it arrives. Revenue NSW’s records can be out of date if you’ve sold or moved during the year. If the notice lists a property you sold before 31 December, or doesn’t show that one became your home, raise it with Revenue NSW before you pay.

You can look up a property’s land value through the Valuer General’s land value search. It’s a different number from the price and usually much lower.

What’s taxed, and what isn’t

Your home isn’t. The principal place of residence exemption allows one exemption per family, only one property worldwide can be an owner’s home, and the people living there must own at least a quarter of it between them. There are concessions while you build or renovate, generally for up to four years and sometimes six. Others cover moving between homes, or living away for up to six years.

Almost everything else is taxable. Revenue NSW lists investment properties, holiday homes, vacant land and company title units among the land it taxes, and it says plainly that it doesn’t matter whether the land earns an income. A holiday house at the coast counts the same as a rental.

Primary production land can be exempt where it’s used dominantly for primary production, with a commercial test on land that isn’t zoned rural. Partial exemptions aren’t available, so a hobby farm on the city fringe usually doesn’t qualify.

Why North Shore investors cross the line with one house

The land is most of the value up here. At 1 July 2025 the Valuer General put the median residential land value in Ku-ring-gai at $2,210,000, with Willoughby at $2,400,000, North Sydney at $2,740,000 and Hornsby at $1,340,000. A single investment house at any of those medians is already over the threshold before you count anything else.

The threshold is frozen while land values keep moving. The Valuer General’s 2025 values showed residential land up 4.2% across NSW, and the three-year average carries each rise forward. In Ku-ring-gai the median went from $2,160,000 to $2,210,000 in a year. A frozen threshold and rising values mean more owners cross it every year without buying anything. That’s why we check land tax on property people already own, not just on the next purchase.

A hypothetical, run through the calculator

Here’s a hypothetical, using the Ku-ring-gai median as the land value and invented details for the owner, run through our land tax calculator. An investor owns one rental house with a land value of $2,210,000 in each of the last three years. The tax is $100 plus 1.6% of $1,135,000, which comes to $18,260 a year.

Now add a second investment with $400,000 of land value. Combined, that’s $2,610,000 and the tax rises to $24,660, so the extra $6,400 is 1.6% of every dollar of the new land, because the threshold was already used up by the first property.

That second number is the one investors forget. Once you’re over the threshold, each new property’s land is taxed from its first dollar. It adds up fast. The first house alone costs about $351 a week in land tax, before any interest or strata.

Joint owners, trusts and foreign owners

Joint owners are treated together first, as a single primary taxpayer with one threshold, and then each owner is assessed on their share alongside anything they own alone, with a deduction so the same land isn’t taxed twice. Revenue NSW’s example of two owners with $1,200,000 of land between them comes to $2,100 at the joint level. Special trusts get no threshold at all and pay 1.6% from the first dollar, so Revenue NSW’s own example of $600,000 of land in a special trust costs $9,600. A fixed trust gets the threshold like anyone else. Foreign persons pay a 5% surcharge on residential land, with no threshold, even where the land is exempt from ordinary land tax.

How you hold an investment changes the bill. A company or a special trust can’t claim the home exemption at all. It’s worth setting up the ownership with your accountant before you exchange, because changing it later usually means another round of stamp duty.

Paying it, and the discount

You have 60 days from the notice to pay or set up a plan, and Revenue NSW gives a 0.5% discount if you pay in full before the due date. Interest-free plans of three, six or nine months are available too. Revenue NSW also has its own land tax calculator, which is worth running next to ours before you budget. Land tax on an investment property is also an immediate deduction against the rent.

What we’d tell an investor

The federal changes make this sharper. For an established home bought after 7:30 pm on 12 May 2026, rental losses can’t reduce your salary from 1 July 2027 and are carried forward instead. Land tax is still deductible, but on a negatively geared house it adds to a loss you may not use for years, which makes it a cash cost now against a benefit that waits for a sale.

Our view, which house-first investors won’t share: on the North Shore, land tax is often the cost that decides house against unit, more than the interest rate. A house’s land value can push you past the threshold on its own, while a unit carries only its share of the land value of the whole site, set by its unit entitlement, so run the land tax before you fall for a block.

Ansa puts land tax into the holding cost on every investment purchase, next to the interest and the strata, because lenders and buyers alike tend to leave it out. What we can’t do is change your land value or give you tax advice. If you think the Valuer General’s figure is wrong, that’s an objection you lodge with them, and the ownership structure is your accountant’s call. The investment property calculator shows what the property costs week to week once the land tax is in.