land tax deduction

 Author: NikkiATO(Community Moderator)Community Moderator

14 Nov 2025

Hi @Sherry123,

For NSW land tax on rental properties, you claim the deduction in the income year the liability relates to, not when you receive the assessment notice or pay it.

Your liability to pay land tax doesn't rely on when the taxing authority issues an assessment. The timing depends on the relevant state legislation and when the property was used for income-producing purposes.

Using your example, the 2025 land tax assessment relates to land held as of 1 January 2025. You'd apportion this deduction across the financial years it relates to - half in FY2024-25 and half in FY2025-26.

When you receive land tax assessments in arrears, the amounts are deductible in the respective income years the liability relates to, not when you pay them. If you've already lodged your tax return, you'll need to amend it for the relevant year, so the deduction is claimed correctly.

You can find more info on our Rental expenses page.

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