This is an important notice for home owners who have a granny flat on their property. The Victorian Land Tax Act has just been amended before Christmas last year so that buildings capable of being used as a residence on a separate but adjoining title would no longer be covered by the principal private residence exemption attaching to the residence of that adjoining title.
This applies to granny flats for those who have them on their property. A granny flat which is located on a separate title to the adjoining residence which attracts the principal residence exemption, can no longer apply the said exemption on the granny flat land.
However, the Principal Private Residence exemption will continue to apply to an adjoining title which contains a tennis court, garden, swimming pool or greenhouse, so long there is no residence on that adjoining title.
For more clarification and to seek guidance and advice, please follow this link.