Alert

Who does this affect?

Landlords of commercial and industrial properties will be able to recover land tax from tenants after 30 June 2009.

What do you need to do?

Landlords of commercial and industrial premises should amend their leases to include land tax as a recoverable outgoing from 30 June 2009. Tenants should budget to pay land tax as an outgoing in new leases.

Author
David Colenso  
Partner

---

David Colenso  
Partner
T +61 7 3244 8152

---

David Bell  
Partner
T +61 7 3244 8051

---

Legislation recently introduced into Queensland parliament will enable landlords of commercial and industrial premises to pass-through land tax to tenants in new leases after 30 June 2009.

What is proposed?

Queensland’s current Land Tax Act prohibits landlords recovering land tax from tenants. The Revenue and Other Legislation Amendment Bill introduced into Parliament on 3 June remove this prohibition from new commercial and industrial leases. The restriction will still apply to retail and residential leases.

Does it apply to all leases?

The removal of the restriction only applies to new leases signed after 30 June 2009. It will not apply to leases:

• entered into before 30 June 2009

• arising from renewal under an option contained in a lease dated prior to 30 June 2009, or

• arising from an assignment or transfer of a lease dated prior to 30 June 2009.

The Property Council of Australia lobbied the government to remove the pass-through restriction from all existing leases and assignments and from renewals of existing leases under options, but was unsuccessful.