Absentee Owner Surcharge in Victoria
The absentee owner surcharge is an additional 1.5% amount over the land tax absentee owners pay. You must notify the State Revenue Office by 15 January the year after you become an absentee owner. An absentee owner is someone who owns investment property in Victoria but does not live in Australia. The surcharge applies from the year you become an absentee owner. The surcharge applies to all types of property. Some exemptions exist, for example if the total taxable value is below $250,000. You should clarify with an accountant whether you are considered an absentee owner. The surcharge calculation will be included in your land tax assessment. Failing to notify authorities that you are an absentee owner means you may need to pay penalty tax.
Definition of Absentee Owner
An absentee owner is a person or entity that owns a property but does not occupy or manage it directly. Absentee real estate owners can be remote investors, REITs, homeowners who move away, and inheritors. Being an absentee owner allows individuals to diversify investments and generate passive income. By hiring professionals to handle operations, absentee owners can focus on other endeavors. However, it can be more costly to maintain and require reliance on third-party management.