NSW land tax concession expanded for unoccupied land
The Commissioner of NSW state revenue now has the power to extend the concession for unoccupied land to be treated as a principal place of residence (PPR) from 4 years to 6 years.
As per Commissioner’s Practice Note CPN 031, the Commissioner of NSW state revenue can now extend the concession for unoccupied land intended to be the owner’s principal place of residence (PPR).
The practice note also provides guidance on exceptional circumstances, beyond the owner’s control, which must exist for the Commissioner to approve an extension.
From 1 July 2023, the Chief Commissioner may grant an extension in the concession, following the year the land is acquired. The extension may also be granted retrospectively for concessions that ended on 31 December 2019.
Schedule 1A, clause 6 of the Land Tax Management Act 1956 provides a concession for unoccupied land to be treated as the PPR if the owner intends to use and occupy the land solely as their principal place of residence once any building works are completed and the timing requirements are met.
Concession extension — eligibility criteria
Amendments to legislation permit the Chief Commissioner to extend the availability of the concession from 4 tax years to up to 6.
To exercise this power, the Chief Commissioner should be satisfied that:
• there has been a delay in the completion of the building or other works necessary to facilitate the owner’s intended use and occupation of the land as a principal place of residence
• the delay is due to exceptional circumstances beyond the control of the owner, and
• the delay could not reasonably have been avoided by the owner.
Exceptional circumstances
Circumstances the Chief Commissioner may consider exceptional and beyond the owner’s control include:
• unforeseen delays in obtaining approval from the council
• unforeseen works necessary to stabilise the land for building
• shortage of skilled tradespersons
• shortage of basic building materials
• extraordinary events like fire, flood, etc
• defective building works requiring remediation that delays occupation of the dwelling
• builders becoming insolvent or ceasing business.
Delays due to conflicts with a builder or neighbour, design variations or delays in obtaining finance are listed as circumstances that would not be considered "exceptional".
It is insufficient that circumstances are beyond the control of the owner — such circumstances must also be exceptional.
How to apply for an extension
In order to apply for an extension, an applicant must lodge a detailed written submission explaining the reason(s) for the delay, why the circumstance(s) is/are exceptional, and why the delay is beyond their control.
Supporting evidence
Evidence must also be provided to substantiate the reason(s) for the delay. Evidence could include:
• medical certificates
• correspondence from the council, builder or liquidators/administrators
• insurance claims relating to natural disasters such as bushfires and floods
• home building warranty claims
• any other evidence to support the request for the extension.
Contact us
Reach out to us if you need to apply for an extension and we can assist you in preparing your application and guide you through any queries that you may have.
