Bundilla Beef resource | 3 July 2026

How Revenue NSW Uses the 3-Year Average Land Value

A worked guide for NSW rural and semi-rural landholders checking land value, land tax exposure and primary production evidence.

Quick answer

Revenue NSW generally uses a three-year average of land values when calculating NSW land tax. Instead of using only the latest land value, Revenue NSW averages the relevant land values for the current land tax year and the two preceding land tax years.

For the 2026 land tax year, Revenue NSW gives an example using values determined on 1 July 2023, 1 July 2024 and 1 July 2025. The average is then compared with the current land tax thresholds and rates.

Working rule: the three-year average is a calculation input. It does not decide whether land is exempt. Primary production exemption depends on the property facts, ownership, use of the land and evidence for the relevant tax year.

Why the average matters

A single land value can move sharply after a revaluation. A three-year average can smooth those changes for land tax purposes, but it can also mean an older high or low value still affects the current assessment. Rural owners should check all three values, not only the latest valuation notice.

This is especially important where a property has changed use, changed ownership, been subdivided, had an objection allowed, or moved in and out of possible exemption categories. The average can affect the dollar estimate, while the exemption question still depends on the land-use evidence.

Revenue NSW example in plain English

Revenue NSW uses this type of calculation for the 2026 land tax year:

Land tax year	Value determined on	Example land value
2024	1 July 2023	$1,050,000
2025	1 July 2024	$1,100,000
2026	1 July 2025	$1,150,000

The three values are added together and divided by three: ($1,050,000 + $1,100,000 + $1,150,000) / 3 = $1,100,000. That average land value is then used in the land tax calculation, subject to the relevant threshold, rate, ownership and exemption rules.

What rural landholders should gather

Record	Why it helps	Where it may come from
Current and prior land values	Shows the values that may feed the three-year average.	NSW land value search, valuation notices, Revenue NSW assessments.
Ownership and parcel schedule	Shows which landholdings belong in the same assessment group.	Title records, purchase records, company or trust records, adviser files.
Assessment notices	Shows how Revenue NSW applied land values, thresholds and exemptions.	Revenue NSW correspondence and Land Tax Online records.
Objection or amended valuation records	An altered land value can change the average value used for land tax.	Valuer General, NSW Government valuation correspondence or adviser files.
Primary production evidence	Can help demonstrate why some land may be exempt before the taxable value is calculated.	Maps, activity logs, photographs, operator records, invoices and sales records.

How the average interacts with primary production

The three-year average does not replace the primary production test. A landholder may still need to show what land was used for, whether the use was genuine and commercial in character, and whether any residential, recreational, rental or unused areas should be treated differently.

Good records can help separate two questions that are often mixed together:

What land value or average value is Revenue NSW using for the assessment?
Which land, if any, may be exempt because it is used for primary production?

Keeping those questions separate makes the file clearer for an accountant, lawyer, tax adviser or Revenue NSW review.

Common mistakes

Mistake	Why it can cause problems	Better approach
Using only the latest valuation notice	The land tax calculation may use a three-year average, not just the newest figure.	Record the current year and the two prior land values used for land tax.
Using sale price instead of land value	Land tax is based on land value, not the full market value with improvements.	Use official land value records and keep the source with the estimate.
Assuming the average decides exemption	The average affects calculation, but exemption depends on property facts and statutory requirements.	Maintain a separate primary production evidence file.
Ignoring amended values	An objection, appeal or corrected valuation can require the average to be recalculated.	Keep valuation correspondence with the land tax working file.
Assessing each property in isolation	Revenue NSW can assess combined taxable NSW holdings depending on ownership.	Prepare an owner-by-owner schedule before estimating liability.

How Bundilla Beef can help

Bundilla Beef helps NSW rural and semi-rural property owners organise practical property records: land-use maps, activity logs, photographs, operating notes and annual summaries. Those records can help demonstrate what is happening on the land and may help support conversations with accountants, lawyers, advisers or Revenue NSW.

For three-year average questions, Bundilla's role is practical rather than advisory. We can help owners keep the land value calculation separate from the primary production evidence file, so assumptions are clear before professional advice or Revenue NSW review.

Disclaimer: Bundilla Beef does not provide tax, legal or financial advice and does not guarantee a land tax exemption. Landowners should obtain advice from their accountant, lawyer or tax adviser before relying on any land tax position.

Source notes

This resource was prepared using official NSW sources checked on 3 July 2026. Source links should be checked periodically for changes.