Deceased estates and land tax
When someone dies, the land that they owned, either solely or jointly, forms part of their deceased estate. The deceased landowner is still considered the owner of the land until administration of the estate is completed.
The administrator (or executor) of a deceased estate will apply to the supreme court for a grant of probate or letters of administration. This allows them to pay the debts of the estate, and sell or transfer land in accordance with the will.
Land held by joint tenants
Land held as joint tenants automatically transfers to the surviving owner from the date of death.
If you have not registered a Form 4—Request to record death with Titles Queensland before 30 June following the date of death, you need to contact us. If you don’t, the surviving owner could receive land tax assessment notices. These may include penalties and interest if they cover multiple years.
Michael passed away in 2017. At the time of his death, he and Jane held commercial land (valued at $1.1 million).
Five years after Michael’s death, Jane registered the Form 4. Ownership of the land then transferred from the date of death, and Jane received 5 years of land tax assessments.
Land held as tenants in common
The administrator will hold any interest in land held as tenants in common until they have sold or transferred the land, or commenced holding it other than as an administrator. They will need to pay any land tax liabilities during this period.
Land tax applies to the land when its total taxable value is $600,000 or more. The estate’s liability may be reduced if an exemption applies or if a beneficiary is eligible to be assessed as the owner of the land.
If the deceased owner was eligible for a home exemption at the prior 30 June, the exemption may continue to be available for up to 1 year after the date of death.
The taxable value of Bob’s land holdings is $650,000 on 30 June 2021.
On 17 August 2021, Bob passes away. The administrator of Bob’s estate applies for a home exemption for the property Bob was living in on 30 June 2021. If approved, the home exemption will continue until 17 August 2022, unless the property is rented or transferred in accordance with Bob’s will.
Other exemptions may continue to apply where the land continues to be used for an eligible purpose (e.g. a business of primary production).
You may also ask for certain beneficiaries to be assessed as the owner to reduce the liability of the estate.
Where the will provides for a life estate or a gift of a specific interest in land to a beneficiary, you (as administrator) can complete a Form LT24 to ask for the beneficiary to be assessed as if the land has been transferred into their name.
As an administrator, you must contact us if:
- a Form 5—Transmission application has not been registered with Titles Queensland before 30 June following the date of death
- you commence holding the land other than as an administrator (e.g. as a trustee holding property on trust for a beneficiary in accordance with the will). In this instance, the land may be liable for land tax if the taxable value is $350,000 or more. Exemptions may be available.
You should obtain a clearance certificate before transferring any land to a beneficiary. This will confirm that all land tax has been paid by the estate. Otherwise, the beneficiaries may receive assessments that could cover several years, and include penalties and interest.