The 2020-21 Victorian State Budget handed down on Tuesday 24 November 2020 by Treasurer, Tim Pallas aims to support a jobs-led recovery, putting local business and workers first. Notable measures contained in the budget include:
New jobs tax credit
Businesses with annual Australian group wages less than $10 million will receive a payroll tax credit of 10 cents for every dollar of taxable Victorian wages paid in 2020-21 and 2021-22 above the previous year's wages. Special rules will apply for new businesses.
Payroll tax threshold increase
From 1 July 2021, the threshold for paying payroll tax annually will be increased from $40,000 to $100,000. An estimated 7,000 extra businesses will be able to pay their payroll tax annually, rather than monthly.
Land transfer duty waiver
A land transfer duty waiver of 50% will apply for purchases of new residential properties (and 25% for existing residential properties) for contracts entered into between 25 November 2020 and 30 June 2021. This relief applies to properties with a dutiable value of up to $1 million and is over and above existing concessions. A first home buyer, for example, purchasing an existing home worth $700,000 will be eligible for both the first home buyer duty concession and then the new 25% waiver, totalling tax relief of more than $18,500.
Commercial and industrial land transfer duty concession
The regional Victoria 50% commercial and industrial land transfer duty concession will be brought forward to apply to contracts entered into from 1 January 2021 (rather than 1 July 2023 as per the 2019-20 Budget).
Build-to-rent sector in Victoria
Under Victoria's Big Housing Build program, a 50% land tax discount will be available for eligible new build-to-rent developments from 1 January 2022 until 2040. These developments will also be exempt from the Absentee Owner Surcharge over the same period.
For more information on the Victorian Budget announcements including how these may impact you or your business, please contact your usual Mazars advisor or alternatively speak to Victorian tax specialist Evan Beissel on +61 3 9252 0800.
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