Bushfire tax relief measures

In response to the recent devastating bushfires, a raft of tax relief measures have been announced by the State Governments and the Australian Tax Office (ATO). Below is a summary of the new measures to assist affected communities.

Land Tax

Land tax assessments have been placed on hold for people who live or own land in affected postcodes in VIC, ACT, NSW, QLD, SA, TAS and WA.

New South Wales

The NSW Government announced one-year relief for the following:

Fines and fees:

  • place a hold on all fines and debt for people in a bushfire affected area
  • extend payment deadlines
  • lift driving sanctions
  • contact Work and Development Order (WDO) sponsors to place WDOs on hold if necessary.

Taxes, duties, grants and royalties:

  • give more time to lodge any documents or returns
  • extend payment deadlines
  • agree not to charge interest
  • arrange to pay debts in instalments
  • to apply for a refund of motor vehicle duty paid on a replacement vehicle, if the vehicle was written off in a declared natural disaster.

Payroll tax:

  • Wages paid or payable to an employee for bushfire-fighting activities or emergency operations are exempt from payroll tax. A letter outlining their period of involvement with Rural Fire Services NSW or SES will suffice to substantiate this exemption to easily identify the exempt amount, record the payments as ’emergency services leave’.

Victoria

A press release from the Victorian State Government announced one-year relief options for affected property owners and/or their representatives.

They would not be required to pay the following:

  • Title and other search fees payable to Victorian Land Registry Services, to help, for example, support insurance claims for properties damaged by bushfire
  • Land transfer duty (stamp duty) up to $55,000 on the purchase of a home elsewhere to replace a home destroyed by bushfire and will not be rebuilt
  • Land Use Victoria lodgment fees on land transactions relating to properties damaged or destroyed by bushfire
  • Property Exchange Australia (PEXA) fees payable in respect of the lodgment of land transactions.

In addition,

  • Receive up to $2,100 relief from stamp duty on up to two replacement vehicles lost in bushfires.
  • Land tax assessments to be suspended in fire-affected areas
  • Businesses, families and individuals whose properties were destroyed or substantially damaged by bushfires will get ex-gratia relief for their 2020 land tax assessment.
  • Anyone who makes their eligible properties rent free for fire-affected people will also have land tax waived
  • Immediate regional payroll tax relief in “State of Disaster” areas, so that regional employers only pay 25 per cent of the metropolitan rate
  • 50% concession on stamp duty for eligible properties, allowing businesses to relocate, expand or move into the fire-affected areas – sending a clear signal that these destinations are open for business
  • The State government will waive:
    • Water rates for 12 months for all homes or businesses destroyed or significantly damaged by fire, and providing rebates for customers affected by interruptions to their water supply.
    • Administration fees associated with VicRoads registration refunds for vehicles that have been damaged or destroyed, saving owners up to $60.
    • Associated costs and fast-track requests for birth and wedding certificates destroyed by the bushfires.

The Victorian Government will also replace lost documentation free of charge, suspend land tax for eligible businesses, families and individuals for one year in affected areas.

Individuals who need to replace their documents should call the Department of Justice and Community Safety on 1300 365 111 or (03) 5215 8500 between 8am – 5pm.

Taxes and Duties 

Details have been provided by the State Revenue Office to assist with land tax, land transfer (stamp duty) and motor vehicle duty. If you want to discuss these measures, call State Revenue Office on 13 21 61.

South Australia

Two-year tax relief measures include:

  • Ex-gratia tax relief for the stamp duty payable on the purchase of replacement properties and motor vehicles
  • Ex-gratia relief for 2019-20 and 2020-21 land tax liabilities for those directly impacted by bushfires in South Australia
  • Putting on hold debt collection of Emergency Services Levy (ESL) debts

Two-year fees and charges to be waived include:

  • Service SA waiving the Administration Fee for replacement drivers licences for people whose licences were lost or destroyed as a result of the bushfires
  • Owners of registered vehicles destroyed in the bushfires can apply for a refund of unexpired registration as well as other components of registration including the CTP premium, Lifetime Support Scheme Levy and Emergency Services Levy
  • The Registrar of motor vehicles also has the ability to waive the Administration Fee on the registration of replacement motor vehicles
  • Fees associated with purchasing replacement copies of births, deaths and marriages certificates for those who have had these lost or destroyed in the bushfires.

Click here to read the State Government announcement.

Taxes and Duties
Details have been provided by RevenueSA to assist with land tax, land transfer (stamp duty) and motor vehicle duty. If you would like to speak to someone about these measures, call RevenueSA on 8226 3750.

Australian Taxation Office

The Australian Taxation Office (ATO) has extended its tax relief and assistance for people impacted by the recent devastating bushfires in New South Wales, Victoria, Queensland, South Australia and Tasmania as part of the whole-of-government response to the disaster.

Affected businesses, individuals, and self-managed superannuation funds in impacted local government areas will now have until 28 May 2020 to lodge and pay business activity statements and income tax returns.

This is in addition to the two-month extension granted in November 2019, in response to last year’s NSW and QLD bushfires.

Additionally, the ATO is fast-tracking any refunds that are due to taxpayers in the impacted regions.

The ATO will also be remitting any interest and penalties applied to tax debts since the commencement of the bushfires that have been applied to accounts of individuals and businesses located in impacted regions.

Taxpayers or their agents in these areas do not need to apply for a deferral, a faster refund, or remission of interest or penalties. This will be done by the ATO automatically.

For people who have had documents destroyed by the bushfires, the ATO is able to assist by reissuing documents it has on hand.

For those taxpayers in affected areas with a tax debt or outstanding obligation, the ATO will not initiate debt recovery action until at least 28 May 2020.

Taxpayers can also request payment arrangements for outstanding debts.

The ATO will also consider releasing individuals and businesses from income tax and fringe benefits tax debts if they are experiencing serious hardship.

Affected taxpayers are also able to vary their income tax instalments to nil without penalties. This also applies if taxpayers end up in a tax payable situation for that quarter once they have lodged their tax return.

If a taxpayer has been affected by this disaster but their postcode is not currently in the identified list, the ATO ask them to phone their Emergency Support Infoline on 1800 806 218 for tailored help.

The ATO will continue to assess the impact of the bushfires and will keep the community informed as it receives more information on additional impacted postcodes and available support.
This tax assistance currently applies to multiple local government areas in New South Wales, Victoria, Queensland, South Australia and Tasmania. A complete list is available on their website at: ato.gov.au/NaturalDisasters

Employers are reminded that they still need to meet their ongoing super guarantee obligations for their employees. Automatic deferrals do not apply to large Pay As You Go withholders, however large withholders can contact the ATO for assistance with their tax obligations if required.

Any member of the community impacted by disaster and needing assistance or anyone suffering financial hardship is encouraged to talk to their tax or BAS agent or contact the ATO on 1800 806 218, when they are ready, to discuss their situation.

Further details are expected to be released on the tax relief measures.

This article was co-authored by Bill Leung, HLB Mann Judd Melbourne.