Property taxes in Australia: Full guide for Americans

Buying property in Australia as an American is exciting, whether you're investing or planning to call Australia home. But with your property investment or new home also comes responsibility.

Namely, you'll now have to pay property taxes in Australia, and it's essential to understand what these taxes are and how you can pay them. Here's everything you need to know about your tax obligations as an American property owner in Australia.

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Table of contents
What are property taxes in Australia? What types of property taxes are there in Australia? How are property taxes calculated in Australia? How to pay property taxes in Australia? Are there any property tax exemptions in Australia? Penalties for not complying with property tax rules in Australia Frequently asked questions

What are property taxes in Australia?

Australia's property tax system covers multiple stages of ownership:

• When you buy, you'll face stamp duty tax
• During ownership, expect to pay ongoing council rates and potentially land tax
• When you eventually sell, capital gains tax comes into play
• If you decide to rent out your property, you'll also need to handle income tax on your rental earnings

Your property tax liabilities in Australia also depend on your residency status. Australian residents and non-residents have slightly different obligations.

Australian residents include people who live in Australia and consider it their primary home, or those who spend more than half the financial year in the country (unless their main residence remains overseas with no intention of permanent Australian residence).¹

As a resident property owner, you'll pay standard residential property taxes like council rates and land tax, and you also often have access to concessions and allowances, especially if your property is your primary residence.

Foreign residents may have more obligations under the Australian tax laws. You may have to pay the Foreign Investment Review Board (FIRB) application fees and vacancy fees if your property sits empty or unavailable for rent for 6 months or more annually.¹

You also won't be eligible for certain tax benefits that are only available to Australian residents, so you’ll likely pay slightly more in property taxes.

Property taxes in Australia by regions

Australia doesn't have one nationwide property tax rate. Instead, each state and territory sets its own property tax rules and rates through local governments and state revenue offices.

In other words, how much you pay in property taxes in Australia heavily depends on where your property is located.

Here's an overview of Australia's different regions and the applicable tax authorities:

Region	Tax authority²
Australian Capital Territory	ACT Revenue Office
New South Wales	NSW Office of State Revenue
Queensland	Queensland Government
South Australia	Revenue SA
Tasmania	State Revenue Office of Tasmania
Victoria	State Revenue Office Victoria
Western Australia	WA Office of State Revenue
Northern Territory	No land tax

You should get in touch with the relevant state and territory governments if you have questions about your tax rate or when and how to pay your taxes.

What types of property taxes are there in Australia?

Stamp duty

Stamp duty is a one-time tax you pay when you buy property. Essentially, it's the government's fee for transferring ownership from the seller to you.

Each state and territory sets its own stamp duty rates and rules, so what you pay in Sydney will be different from Melbourne or Perth.

How much you pay in this transfer duty depends on factors like your property's value, what type of property it is, and why you're buying it. Foreign buyers, including Americans, may pay stamp duty at higher rates, so that's also something to keep in mind.

Council rates

Council rates are quarterly (or annual) taxes that local governments charge property owners. Every council sets its own rates, payment schedules, and valuation methods, but your bill typically includes:

• General rates: the main charge for council services
• Utility rates: covering services like waste management, stormwater, or gas
• Special rates or charges: one-off fees for specific projects or improvements

These rates fund essential community services like road maintenance, parks and gardens, libraries, immunization programs, community activities, and more. Usually, the higher your property value, the more you pay in property taxes.

Land tax

Land tax is an annual property tax that most states and territories charge landowners. But, for example, Northern Territory doesn't have this tax. How much you pay usually depends on the total unimproved value of all your taxable land holdings combined.

However, most owner-occupiers don't pay land tax on their main residence. It's primarily a tax on investment properties and vacant land, but it ultimately depends on your local government.

Many regions have tax-free thresholds, meaning you only start paying once your total land value exceeds a certain amount. Then, the more valuable land you own, the higher your land tax bill becomes.

Income tax

If you rent out your Australian property, you'll need to pay income tax on your rental earnings. This applies whether you're an Australian resident or a foreign investor. Rental income simply gets added to your total taxable income for the year.

However, a nice bonus is that you can claim deductions for property-related expenses like maintenance, repairs, property management fees, and depreciation.

Vacancy fee

The vacancy fee applies to Americans and other foreign property owners who leave their residential properties empty.

If you're a foreign resident and your property sits vacant or unavailable for rent for 6 months or more during 12 months, you'll likely face this annual charge.¹

The fee equals whatever you originally paid in Foreign Investment Review Board (FIRB) application fees when you bought the property. So if your FIRB fee was 13,200 AUD, that's your annual vacancy fee.

This policy aims to make foreign-owned properties contribute to Australia's housing supply instead of sitting empty.

Capital gains tax

Capital gains tax applies when you sell your property for more than you paid for it. You'll pay tax on the profit (capital gain) at your marginal tax rate.

Australian residents get a 50% discount on capital gains tax if they've owned the property for more than 12 months. If you're an Australian resident and the property is your primary residence, you're also often exempt from the capital gains tax.¹

However, foreign residents don't receive these benefits and typically pay the full rate.

How are property taxes calculated in Australia?

It depends on where your property is located because each state, territory, and local council sets its own rates and methods. Since there's no uniform national system, you'll need to check with your local tax authority or work with a tax professional to calculate your liability.

How to pay property taxes in Australia?

With most property taxes in Australia, you'll pay them through your relevant government authority's website. Some authorities may offer payment plans or quarterly installments to help manage your tax obligations.

Are there any property tax exemptions in Australia?

There are a few tax deductions and exemptions that can reduce your tax burden as a property owner in Australia.

If you own a rental property, the Australian Taxation Office (ATO) allows you to claim deductions for ownership expenses, including:

• Interest on Australian mortgage or property loans
• Depreciation of the building structure, fixtures, and fittings
• Repairs and maintenance costs
• Property management fees paid to agents
• Legal expenses for property-related matters
• Pest control services
• Cleaning costs, especially between tenants
• Gardening and yard work for outdoor maintenance
• Insurance premiums (building, contents, and liability)
• Stationery and postage for property correspondence
• Travel costs for property inspections and maintenance visits
• Utilities you pay as the owner, like water charges or council rates
• Advertising costs to find tenants
• Body corporate fees for strata properties
• Accounting fees for tax preparation

These deductions can help you keep more money from your investment property.

There are also property tax exemptions for the capital gains tax. Primarily, the main residence exemption lets Australian residents sell their primary home without paying capital gains tax.

This exemption also includes an "absence rule."

Under this rule, if you move out and rent your former home, it can still qualify as your main residence for capital gains tax purposes. The property keeps this status for up to 6 years if you're earning rental income from it, or indefinitely if it remains vacant.¹

That said, there are specific conditions that apply, so it's a good idea to consult with a tax professional.

Penalties for not complying with property tax rules in Australia

It's not a good idea to be late on your property taxes in Australia. If you don't pay on time, you'll likely need to pay penalties and interest charges, although it ultimately depends on your local government or tax authority.

Frequently asked questions

How much is the property tax in Australia?

There's no one single nationwide property tax in Australia. It depends on where you buy and your property's value. However, in almost all regions, you'll have to pay the stamp duty tax when you buy, council rates and land tax during property ownership, and capital gains tax when you sell.

Americans who are not Australian residents may have to pay additional taxes, such as a vacancy fee.

How much is stamp duty on a house in Australia?

Stamp duty costs depend on your state, property value, and buyer status. Foreign buyers, including Americans, sometimes face additional surcharges, but it depends on your property’s location and local government.

Do I have to pay property taxes in Australia if I'm American?

Yes, Americans must pay Australian property taxes regardless of their citizenship. In fact, as a foreign resident, you'll typically pay higher rates and miss out on many exemptions available to Australian residents.

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Property taxes in Australia can sound complicated since the rules depend on your region. However, your local government or tax authority can usually answer or clarify any questions you have. Once you pay your taxes for the first time, it'll typically get easier since you'll be used to the process.

One thing that many Americans underestimate is that property ownership also means regularly moving money between the US and Australia, whether that's for paying taxes or transferring rental income.

Using banks for these transfers can be expensive, and you'll likely lose a lot of money in fees and poor exchange rates. This is why it’s important to compare your options and look at different money transfer services, especially if you need to send money regularly.

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Sources

1. Property Tax Specialists - What Is Property Tax?
2. Australian Government - Taxes that could affect your business property

Sources checked 09/19/2025