When is real estate tax free?

The Government is facing questions about its plans to end the current $50,000 real estate property tax for all Australians and instead introduce a property tax rebate.

Prime Minister Malcolm Turnbull has promised to introduce a Property Tax Rebate for first-time buyers at a later date.

The rebate would provide up to $15,000 in tax relief for first time buyers, who will be eligible for a 15 per cent tax rebate when they register.

However, a spokesperson for the Prime Minister said the Government is working to resolve the issue.

“The Government is currently working to establish the appropriate timeframe for the rebate for people who have purchased their first home and have a property worth more than $200,000.

As the Government works through this process, it will keep its focus on supporting first-home buyers and ensuring affordability for first home buyers,” the spokesperson said.

Property tax rebate: What you need to knowProperty tax rebates are an opportunity for people to save money while they wait for a new home.

Under the proposal, first-timers would be eligible to receive up to a 15-per-cent rebate.

The property tax rebate would be paid on a $300,000 property in a 20 per cent discount for first homes and a $150,000 home in a 15 to 20 per per cent rebate.

There are currently six different rebate levels, including $100,000, $150 and $200.

The Government will be looking at the best way to introduce the rebate for first house buyers.

Currently, a first home buyer can receive a rebate of up to 50 per cent.

For first-term buyers, there is no rebate for second homes.

First home buyers who register for the rebate will be allowed to pay up to 40 per cent of their income in property taxes on their first deposit.

This means they will not pay property tax on their new home until they are actually ready to buy.

Under this proposal, people would not be able to pay property taxes until they have completed a mortgage and have paid their mortgage repayments.

Proposal to end real estate asset taxThe proposed legislation would also remove the property tax exemption for new home purchases, with new homes costing $1 million or more.

Proposal: Property tax rebate for property ownersCurrently, new home owners are not required to pay any property tax.

Under the Property Tax Reform Act, all property owners must pay property and land tax on the value of their homes and property.

Under that proposed legislation, all new home buyers would be required to repay property tax to the Government.

This means property owners would not pay any of their own property tax until they move in and the home is worth $200 million or less.

Proposition: Property taxes will be phased outProperty tax rates are set by the Federal Government each year, but there is little information available about when property tax rates would be phased in.

The new property tax proposal proposes to phase out the property taxes for property taxes, with the current rate at 10 per cent in 2020-21.

It would then gradually increase to 12 per cent and 13 per cent over a five-year period.

There are also plans to phase in a new, fairer property tax system for first and second homes, and to remove the tax exemption on new home ownership.

Proposed changes to property taxThe proposal would also allow property owners to repay their property tax when their property value increases by more than 50 per-cent from their current level.

That means they could be able repay a property of up, say, $300 million, with their tax rebate to the Commonwealth being worth $15 million.

The rebate rate would then be based on the new value of the property, which would be $200m in 2020.

Proposals to end property tax exemptionsProposed change to the property value of propertiesProposed new property values would be indexed to inflation.

The proposal says the new property value would then increase by $100 million annually.

Propose: Property value of property to be indexedProposed property value will be indexed every five years to inflation to ensure the Government doesn’t have to borrow to cover tax increases.

The proposed changes to the rate of property tax will be rolled out over five years, with rates ranging from 10 per-year to 20-per cent.