Tax information for landholders
Updated July 2023
This information sheet addresses taxation issues relating to the interests of owners of land being managed for conservation purposes as well as those wishing to enter into environmental market arrangements.
Trust for Nature is grateful to all Victorians who conserve the natural habitat on their land, in particular those who make the significant commitment to protect their land forever with a conservation covenant. We appreciate that the taxation implications of conservation payments and activities can be complex, and we hope that this information sheet will help Victorians navigate this area a little more easily.
This information sheet is not intended as legal advice or an alternative to obtaining independent taxation advice, but may assist in guiding decisions and identifying what advice you may need to seek.
New land tax exemption for conservation covenants
What is the new land tax exemption?
From January 1 2024, land protected with a conservation covenant through Trust for Nature will be exempt from land tax.
Who will this tax change apply to?
This change will apply to any landholder with a Trust for Nature conservation covenant.
What part of the land will the tax exemption apply to?
The area of land subject to the covenant will be exempt from land tax. Any part of the land that is not covenanted will retain its existing land tax liability (noting that not all land uses are liable for land tax).
Can I pay for my own conservation covenant?
Trust for Nature relies on the generosity of supporters to fund the cost of administering and stewardship covenants. While our aim is to protect as much habitat as possible to safeguard Victoria’s wildlife and plants, the costs of covenanting are considerable and we need to prioritise what covenant. Demand for new covenants currently exceeds the available funding.
Landholders can make a huge contribution to protecting Victoria’s nature by paying for a conservation covenant on eligible areas of their land.
The cost and process for a conservation covenant assessment are as follows:STEP 1: Covenant assessment and documentation = $4,100 (+ GST)
STEP 2: Covenant registration fee = $20,500 (+ GST)These fees are a discounted rate for prospective covenantors and represent a significant proportion of the costs required to register and steward a covenant, which can exceed $30,000.
How is site eligibility determined?
Your land may be eligible for a covenant if it contains ecological values such as a high diversity of native plants and animals, proximity to wildlife corridors, or the presence of threatened species. Our conservation staff are trained ecologists and will determine site eligibility on a case by case basis. For more detail read about conservation covenants.
How long does it take to process a conservation covenant?
The assessment and design of a covenant, and the associated management plan, is a comprehensive scientific and legal process. Ministerial approval is required for all covenants and can generally be expected within 10 months of commencing the assessment and documentation, however timelines do vary from property to property depending on the complexity of the covenant and its conditions.