Windfall Gains Tax was introduced by the Victorian Government in 2023. It is a tax that is payable on the uplift in capital value of land that occurs as a result of a government rezoning of the land. It is payable by the registered owner of the rezoned land, subject to any exemptions or deferrals that may apply.

Windfall Gains Tax is governed by the Windfall Gains Tax Act 2021 (Vic) (Act).

When does it apply?

Under the Act, a landowner becomes liable for Windfall Gains Tax when the land is rezoned pursuant to a government planning scheme that results in the value of land increasing by more than $100,000.

If a landowner is issued an assessment notice by the Victorian State Revenue Office for payment of Windfall Gains Tax, the landowner must make payment by the due date stipulated in the notice.

However, a landowner can choose to defer payment until either:

• the next dutiable transaction or relevant acquisition, such as a sale or transfer of the land; or
• 30 years after the rezoning has occurred.

If payment of Windfall Gains Tax is deferred, a charge will be registered against the title of the land until it is paid.  Any unpaid Windfall Gains Tax must be paid before the subject land can be sold.

Rates

As of January 2026, section 9 of the Act provides that the following tax rates apply, depending on the uplift amount:

• if the uplift amount is less than $100,000 – 0%;
• if the uplift amount is between $100,000 and $500,000 – 62.5%;
• if the uplift amount is more than $500,000 – 50%.

 Exemptions

The Act provides that certain types of land are exempt from Windfall Gains Tax. These include, but are not limited to:

• residential land up to 2 hectares;
• land that is owned by charities; and
• land that is rezoned to certain types of public or rural zones;
• land that is affected by technical zoning corrections; and
• land entitled to a transitional exemption.

 Other exemptions may also apply, depending on the land and whether a specific planning change is considered as a rezoning for tax purposes.

 Do you require advice?

The property law team at Kell Moore Lawyers are highly experienced in advising on all stages of property ownership in Victoria. If you own land in Victoria that may be subject to Windfall Gains Tax, please contact the property law team at Kell Moore Lawyers.

This article is for general information only and does not constitute legal advice. You should not rely on this information without seeking professional legal advice.