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Queensland land tax to become recoverable
- By Richard Wheeler
- Published 5/02/2009
- Moore Property News
- Unrated
The draft Land Tax and Taxation Administration Amendment Bill 2009, which remains open for comment until 6 February 2009, will have the effect that lessors of commercial and industrial property and retail premises not covered by the Retail Shop Leases Act 1994, will be able to pass the cost of land tax on to lessees in their leases.
The current prohibition with respect to premises covered by the Retail Shop Leases Act 1994 and the Residential Tenancies Act 1994 will remain.
The changes are to apply to leases that come into existence after 30 June 2009. The prohibition continues to apply to all existing leases.
What the changes mean for landlords and tenants
Should the Bill pass through Queensland State Parliament the amendment to the Land Tax Act will impact on lease negotiations in respect of commercial, industrial and some retail leases.
Specifically, landlords should whether they wish to revise standard lease documents to allow for the recovery of land tax in the definition of outgoings for leases that will come into existence after 30 June 2009.
Likewise, tenants should review definition provisions in leases with respect to operating expenses that may refer to payment taxes generally. This definition will be particularly relevant on removal of any prohibition with respect to land tax recovery after 30 June 2009.
The Bill will make it clear that the prohibition on landlords passing land tax on to tenants contained in s44A of the Land Tax Act will continue to apply to leases in existence before the Bill is passed, as well as, any leases arising from a renewal under an option in that lease or assignment or transfer of that lease.
In Summary
-Consultation on the draft Bill closes 6 February 2009.
-The Bill will remove the existing prohibition on lessors recovering land tax from lessees on industrial, commercial and some retail leases.
-Lessors will still be prohibited from recovering land tax from lessees of residential property and retail premises.
-The amendment will not affect leases if they are either signed or commence before 30 June 2009.
For further information please contact Richard Wheeler on (07) 3317 7869 or your relationship partner.
The current prohibition with respect to premises covered by the Retail Shop Leases Act 1994 and the Residential Tenancies Act 1994 will remain.
The changes are to apply to leases that come into existence after 30 June 2009. The prohibition continues to apply to all existing leases.
What the changes mean for landlords and tenants
Should the Bill pass through Queensland State Parliament the amendment to the Land Tax Act will impact on lease negotiations in respect of commercial, industrial and some retail leases.
Specifically, landlords should whether they wish to revise standard lease documents to allow for the recovery of land tax in the definition of outgoings for leases that will come into existence after 30 June 2009.
Likewise, tenants should review definition provisions in leases with respect to operating expenses that may refer to payment taxes generally. This definition will be particularly relevant on removal of any prohibition with respect to land tax recovery after 30 June 2009.
The Bill will make it clear that the prohibition on landlords passing land tax on to tenants contained in s44A of the Land Tax Act will continue to apply to leases in existence before the Bill is passed, as well as, any leases arising from a renewal under an option in that lease or assignment or transfer of that lease.
In Summary
-Consultation on the draft Bill closes 6 February 2009.
-The Bill will remove the existing prohibition on lessors recovering land tax from lessees on industrial, commercial and some retail leases.
-Lessors will still be prohibited from recovering land tax from lessees of residential property and retail premises.
-The amendment will not affect leases if they are either signed or commence before 30 June 2009.
For further information please contact Richard Wheeler on (07) 3317 7869 or your relationship partner.
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