by Jahnvi Modi and Joulyette Farah
Premier Daniel Andrews announced a $500 million package on 15 April 2020, aimed at giving certainty to residential and commercial tenants and landlords, while they struggle with the unprecedented economic disruption caused by the coronavirus pandemic – with emergency legislation to be put into the Parliament next Thursday.
Consistent with the National Cabinet agreement to implement a mandatory code of conduct for commercial tenancies, the Victorian Government will also urgently legislate leasing principles so that eligible small and medium sized businesses can be granted rental waivers or deferrals.
To encourage landlords to do the right thing by their tenants, the Government will provide $420 million in land tax relief. The government will also create a $80 million rental assistance fund for renters facing hardship due to coronavirus.
Key measures as per the media release include:
- Temporary ban on evictions for residential tenancies for 6 months (except in some circumstances);
- Temporary ban on evictions for 6 months for small & medium size businesses for non payment of rent;
- Pause on rental increases for 6 months for residential & commercial tenancies;
- Access to a fast-tracked dispute resolution service, with Consumer Affairs Victoria or the Victorian Small Business Commission, for tenants and landlords who struggle to strike a deal over rent reduction;
- $420 million land tax relief for landowners & rent relief for tenants impacted by the corona virus;
- Establishment of a new Coronavirus Relief Deputy Commissioner at the State Revenue Office to manage these land tax relief claims; and
- $80 million rental assistance fund for renters facing hardship due to coronavirus (capped at $2,000 per payment).
If passed by the Parliament next Thursday, these new measures will come into effect from 29 March for a period of six months.
Highlights of $420 million land tax relief
- 25% discount on land tax;
- Deferral for balance land until March 2021.
The relief is available for eligible residential and commercial tenancies.
To be eligible, landlords must demonstrate that:
- all or part of their property is rented or all or part of the property is currently available for lease, and
- that at least one of the tenant’s ability to pay their normal rent or your ability to secure a tenant is affected by the COVID-19, and
- Rent relief to the affected tenant/s has been provided in accordance with this scheme.
Landlords will need to provide evidence of the above.
Eligibility criteria for commercial tenancies:
Property must be rented to a tenant with,
- Annual turnover under $50 million; and
- Is eligible for the JobKeeper payment.
Landlords will need to provide evidence that the tenant is eligible for the JobKeeper Payment and have an annual turnover of up to $50 million.
Highlights of $80 million Rental Assistance Fund
Eligibility for tenants:
- Renters will need to have registered their revised agreement with Consumer Affairs Victoria or gone through mediation;
- Renters should have less than $5,000 in savings; and
- Renters should still be paying at least 30 per cent of their income in rent.
For further details in relation to land tax relief please contact us on (03) 9069 7700.