Queensland charities may be able to seek exemption from Land Tax based on Word Investments

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We have recently been successful in a number of applications to the Queensland Office of State Revenue (Qld OSR) for exemption from land tax, and the refund of previously paid land tax, by charities that are using their real estate assets for investment type purposes, based upon Word Investments.

Word Investments was a decision of the High Court in December 2008, confirming that Tax Concession Charity endorsement (and so exemption from income tax and some limited FBT and GST concessions) was available for an organisation engaged in commercial enterprise provided that it existed to fund charitable purposes. (Our Legal resource centre has a detailed case note on the Word Investments decision).

Under the Land Tax Act 2010 (Qld) (the Act) a charitable institution may be able to claim an exemption from land tax for land it owns (or which is held on trust for it) if the land is used for a qualifying ‘exempt purpose’, for example public benevolence, religion, education, relief of poverty, provision of care (s 46 and 47 of the Act).

Based upon Word Investments, we have successfully argued that if a charity is applying the income from its investment property to its charitable purposes, and those purposes fall within the qualifying exempt purposes under the Act, the property itself is being used for a qualifying exempt purpose.

This has lead to substantial savings and refunds.

For more information regarding Word Investments

Please contact our Business Development Team or call us on (07) 3252 0011 to book an appointment with one of our specialist NFP Lawyers today.