Victorian State Taxes 2026: Key deadlines and changes for property owners and investors

Key points:

• Vacant Residential Land Tax (VRLT) – Annual notification deadline now 15 February; unimproved residential land may be subject to VRLT
• Land Tax – 2026 assessments issued from late January; Absentee Owner Surcharge notification due 15 January
• Congestion Levy – 73% rate increase affecting existing and new levy areas including in Cremorne, Richmond, South Yarra, Windsor
• Short Stay Levy Registration – Deadline of 30 January 2026 for those with total bookings under $75,000 per year
• Emergency Services Levy – Increased fixed charge for residential investment properties from 1 July 2026
• SRO compliance focus – Enforcement targeting VRLT, land tax, landholder duty, leasehold transactions
• Land Tax adjustment threshold – $10.7 million indexed threshold for 2026 calendar year

As Victorian property owners, developers, investors, and short-stay operators navigate into 2026, several critical state tax changes require immediate attention. This guide covers essential Victorian state tax updates, compliance deadlines and SRO enforcement priorities to help stay compliant.

1. Vacant Residential Land Tax – New rules for 2026

Unimproved land now subject to VRLT

From the 2026 land tax year, Vacant Residential Land Tax (VRLT) now applies to “residential land” that has remained undeveloped for at least five years in certain circumstances, following the expansion of VRLT from 1 January 2025.

Critical VRLT deadline: VRLT annual notifications must be lodged by 15 February 2026.

Victorian landowners with vacant or undeveloped residential properties should review their VRLT obligations immediately to avoid penalties.

Previously published articles:

• Navigating vacant residential land tax changes: what’s different and needs action for 2026
• Vacant residential land tax – essential information and new rules for unimproved land

2. Victorian Land Tax 2026: Assessments and Absentee Owner Surcharge

The State Revenue Office (SRO) will issue 2026 land tax assessments from late January 2026.

Land tax compliance checklist for Victorian property owners:

• Review land tax assessments for accuracy including ownership details, property valuations, exemptions and absentee owner status
• Note the 60‑day objection period for land tax assessments (extensions may be available except for valuation objections)
• Notify the SRO within 60 days of any errors such as trust land not recognised, incorrect exemptions have carried over or ownership discrepancies

Absentee Owner Surcharge deadline: 15 January (applies to foreign property owners in Victoria)

3. Congestion Levy 2026 – Rate increase and expanded coverage

Effective 1 January 2026, the following significant changes apply in relation to Congestion Levy:

• 73% rate increase for parking spaces in the congestion levy areas
• Levy areas now expanded into additional inner-eastern suburbs such as in Cremorne, Richmond, South Yarra, and Windsor

These areas join the existing congestion levy zone based on proximity to the Melbourne CBD.

Read more about Victorian congestion levy changes

4. Short Stay Levy: Registration deadline 30 January 2026

Registration for the first annual return of the Short Stay Levy is required by 30 January 2026 for:

• Owners and tenants who receive direct short-stay bookings (not through booking platforms); and
• Booking platforms facilitating short-stay accommodation;

where annual booking collections are under $75,000.

If $75,000 or more per year, then lodgement and payment are on a quarterly basis, which started from 30 April 2025, with the final quarterly return due 30 January 2026.

Non-compliance with short stay levy obligations may result in penalties.

5. Emergency Services Levy: Changes from 1 July 2026

From 1 July 2026, the fixed charge component for the Emergency Services and Volunteers Fund Levy will increase for non-principal place of residence (PPR) properties such as investment properties and holiday homes.

This follows previous Emergency Services Levy changes effective 1 January 2025.

Emergency Services Levy updates explained.

6. State Revenue Office Victoria: 2025-26 Compliance Focus Areas

In November 2025, the SRO Victoria announced key compliance priorities targeting:

Victorian Land Tax compliance

The SRO expects landowners to review land tax assessments for accuracy and promptly report errors, including:

• Properties incorrectly receiving principal place of residence (PPR) exemption
• Properties incorrectly receiving primary production land tax exemption
• Land owned by trustees not properly disclosed
• Absentee (foreign) landowners not properly identified

Vacant Residential Land Tax enforcement

Following VRLT’s statewide expansion in Victoria, the SRO is focusing on:

• Vacant properties where owners failed to make VRLT notifications
• Properties incorrectly claiming the holiday home exemption from VRLT

Landholder Duty 

Following the Oliver Hume Property Funds (Broad Gully Rd) Diamond Creek Pty Ltd v Commissioner of State Revenue [2024] VSCA 175 court decision, the SRO’s focus includes:

• Capital raisings by Victorian landholders
• Offshore corporate transactions involving Victorian land holdings

Lease duty and leasehold transactions

The SRO is targeting industries dealing in leasehold estates, including:

• Leasehold transactions in caravan parks and lifestyle villages
• Leasehold estates associated with renewable energy projects and asset sales

7. Land Tax adjustment prohibition: $10.7 million threshold for 2026

Since 1 January 2024, Victorian property sellers have been prohibited from passing land tax costs to buyers in contracts of sale below a specified sale price threshold.

The 2026 indexed threshold is $10.7 million.

Therefore, the land tax adjustment prohibition applies to property sale contracts entered in 2026 with sale prices below $10.7 million.

Need assistance?

The above is only a summary of selected changes relating to state taxes in Victoria. We have also covered a number of other recent changes.

If you would like advice on your circumstances, including for the 2026 year, please contact the author or your usual Pitcher Partners representative.