Two different state taxes often appear in the same search results, and they are easy to mix up. Vacant residential land tax (VRLT) is an annual Victorian tax on residential land that was vacant in the previous calendar year, and, from 2026, on some long-undeveloped Melbourne land. Foreign buyer surcharges are extra transfer duty, or in the ACT an annual land-tax surcharge, payable when a foreign person acquires or holds residential land.
They are not the same as ordinary land tax, they are not the Commonwealth vacancy fee that can apply to some foreign owners, and the rates differ by state. The figures below are taken from official revenue office pages reviewed in November 2026. Confirm the current rate, the definition of a foreign person, and any exemption with the office that will assess the transaction.
This is general information only. It is not a duty assessment, and it is not personal advice.
Victoria's vacant residential land tax
The State Revenue Office Victoria (SRO) describes VRLT as an annual tax on vacant residential land in Victoria, aimed at increasing housing supply. It is based on how the property was used in the previous year. If a property was vacant in 2025, you may need to pay VRLT in 2026.
From 2025 it applies to all residential land in Victoria. Before 2025 it applied only to a listed group of inner and middle Melbourne councils.
A property with an existing home is vacant if it has not been lived in, for six months of the previous calendar year, by the owner or a permitted occupant as their home, or by a person under a genuine lease or short-term letting arrangement. The six months do not have to be continuous, or served by the same occupant. The SRO is explicit that it is not enough for the property to be listed for rent, sale or short-term occupation. It must actually be used for six months or more.
A property can also be vacant if, on 31 December, it had a residence that had been under construction or renovation, or uninhabitable, for two years or more. Construction or renovation starts when the building permit was issued, and the renovation must be substantial enough to warrant a permit.
From 1 January 2026, VRLT also applies to land in metropolitan Melbourne that is in a zone other than a non-residential zone, is capable of residential development, and has remained undeveloped for a continuous period of five years or more. That five-year period may have started before 1 January 2026. Metropolitan Melbourne, for this purpose, is the list of councils published on the SRO page, from Banyule and Bayside through to Yarra and Yarra Ranges.
VRLT does not apply to commercial residential premises, residential care, supported residential services, retirement villages, or land in alpine resorts or Dinner Plain. There are also specific exemptions, including some holiday homes, properties that changed ownership in the previous year, and other categories listed by the SRO. Land that is exempt from land tax is also exempt from VRLT.
If you own vacant residential land, you must notify the SRO by 15 February, even if you believe the land is exempt. Assessments are issued before 30 June. You can object to incorrect details within 60 days.
Official VRLT rates
The SRO rates page, updated 13 November 2026, says VRLT is based on the land's capital improved value. There is no threshold and no COVID levy.
These lands are assessed at 1% of capital improved value:
- land in metropolitan Melbourne that has remained undeveloped for a continuous period of five years or more and is capable of residential development
- new residential land unused, unoccupied and unsold for more than three years
For all other land, the rate depends on how many consecutive years the land has been liable:
| Consecutive years liable | Rate of capital improved value |
|---|---|
| One year | 1% |
| Two years | 2% |
| Three or more years | 3% |
Before 2025, VRLT was 1% of capital improved value for all properties. The SRO has a calculator to estimate an amount. VRLT is different from Victorian land tax and from the absentee owner surcharge. Outstanding VRLT can appear on a property clearance certificate.
Foreign purchaser duty surcharges, by jurisdiction
These surcharges are generally an extra percentage of the dutiable value of residential property acquired by a foreign person, paid on top of ordinary transfer duty. "Foreign person" is defined in each state's law and often includes some temporary visa holders, companies and trusts. Permanent residents can still be foreign persons in some states if they do not meet a days-in-Australia test. NSW, for example, generally treats a permanent resident as not foreign only if they were in Australia for at least 200 days in the year preceding the transaction, subject to the official exceptions.
The current official duty surcharge rates, as published in November 2026, are:
| State or territory | Official name | Current published rate | Official source, as reviewed |
|---|---|---|---|
| New South Wales | Surcharge purchaser duty | 9% of the dutiable value of the foreign person's share. Revenue NSW's example on a $1 million residential purchase is $90,000 of surcharge plus $39,187 of transfer duty, using 2026-27 transfer duty rates | Revenue NSW, last updated 20 August 2026 |
| Victoria | Foreign purchaser additional duty | 8% for contracts and arrangements entered into on or after 1 July 2019 (7% for 1 July 2016 to 30 June 2019, 3% for 1 July 2015 to 30 June 2016) | SRO Victoria, updated 13 November 2026 |
| Queensland | Additional foreign acquirer duty (AFAD) | An extra 8% of duty on transactions liable for transfer duty, landholder duty or corporate trustee duty, as stated on the Queensland Revenue Office AFAD page | Queensland Revenue Office |
| Western Australia | Foreign transfer duty | Additional duty of 7% when a foreign person purchases residential property | WA Government fact sheet, updated 23 October 2026 |
| South Australia | Foreign ownership surcharge | 7% of the value of the interest acquired in residential land, in addition to stamp duty, for instruments and transactions from 1 January 2018. RevenueSA's official example is a 20% interest worth $100,000, with a surcharge of $7,000 | RevenueSA |
| Tasmania | Foreign investor duty surcharge | For agreements on or after 1 April 2020, 8% of the dutiable value of residential property, and 1.5% for primary production property, acquired directly or indirectly by a foreign person. Earlier transactions had lower rates. The rates page was last published 29 June 2022 and was still the SRO's rates page in November 2026 | State Revenue Office Tasmania |
| Australian Capital Territory | No additional conveyance-duty surcharge of this kind was published on the ACT Revenue Office pages reviewed. Foreign owners of residential land that is not a principal place of residence pay a land-tax surcharge of 0.75% of average unimproved value a year, from 1 July 2018 | ACT Revenue Office, foreign ownership surcharge for land tax | |
| Northern Territory | No general foreign-purchaser transfer duty surcharge was found on official Territory pages reviewed in November 2026. Confirm with the Territory Revenue Office before you rely on that | Check ntrevenue / nt.gov.au |
Dutiable value is usually the higher of the price and the market value, and the surcharge is typically charged only on the foreign person's share. Joint purchasers are often treated as holding equal shares unless the documents say otherwise. Exemptions and refunds exist in some states for certain developers, build-to-rent projects, or a later change in foreign status, but they are not automatic.
NSW also has surcharge land tax for foreign persons who own residential land. The ACT surcharge described above is likewise an annual land-tax charge, not a one-off duty. Those holding costs can matter as much as the duty at purchase. See the land tax guide, and do not use the individual resident land-tax table for a foreign or absentee owner.
Frequently asked questions
Does listing a Melbourne property on Airbnb avoid VRLT?
Not by itself. The SRO says the property must actually be used for six months or more. Being listed for short-term occupation is not enough.
If I am a permanent resident, do I pay the duty surcharge?
It depends on the state's definition. In some states a permanent visa is enough. In NSW, a permanent resident generally also has to meet a 200-day presence test, with official exceptions. Do not assume a visa label is enough. Ask the revenue office or your conveyancer to apply that state's test.
Can first home concessions cancel the surcharge?
Not automatically. Revenue NSW notes that you may still have to pay surcharge purchaser duty even if you are exempt from transfer duty. WA also says a first-home duty rate does not remove foreign transfer duty on a foreign person's interest. Check the local rule.
General information warning
This article is general information only. It is not personal financial product advice, legal advice or a duty assessment, and it is not a recommendation about buying, leaving vacant or occupying a property. It does not take into account your objectives, financial situation or needs. Rates, vacancy definitions and foreign-person tests change, and an undeclared surcharge can attract penalty tax. Confirm the current rules with the relevant revenue office and your conveyancer before you sign or leave a property unoccupied.
Sources
- State Revenue Office Victoria, Understanding vacant residential land tax, updated 22 October 2026.
- State Revenue Office Victoria, Vacant residential land tax (current rates), updated 13 November 2026.
- Revenue NSW, What is surcharge purchaser duty, last updated 20 August 2026, including the official $1 million example.
- State Revenue Office Victoria, Foreign purchaser additional duty (current rates), updated 13 November 2026.
- Queensland Revenue Office, Additional foreign acquirer duty.
- WA Government, Foreign transfer duty, last updated 23 October 2026.
- RevenueSA, Foreign Ownership Surcharge.
- State Revenue Office Tasmania, Rates of surcharge, last published 29 June 2022.
- ACT Revenue Office, Foreign ownership surcharge for land tax.
Last reviewed: November 2026.