A statutory covenant for preservation purposes will have financial implications for both parties. Landholders considering a covenant should consider the taxation and land valuation implications, rate relief and other assistance that may be available to help meet the costs of maintaining commitments agreed under the covenant.
Incentives are a form of assistance paid or otherwise provided to landholders who undertake improved on-property management, partly to recognise their outlay of time effort and money in the public interest, and partly to encourage them to do so.
Depending on the assistance programs available at the local, regional and state levels, landholders can be assisted with:
- direct grants
- advice and information
- ongoing contact
- contact with other covenantors
- field days
- gate-front signage for covenanted areas.
Some local governments provide financial assistance in the form of rate relief to landholders entering into statutory covenants. For further details on rate assistance available in local areas, contact your local government.
See the database of Natural resource management incentives available to help meet the cost of natural resource management activities.
Income tax deductions and capital gains tax concessions may be available to landholders entering into statutory covenants with state and local government agencies and other organisations listed as a deductible gift recipient with the Commonwealth Department of Environment, Water, Heritage and the Arts. Goods and services tax (GST) may be payable in certain cases.
For further information, see the Conservation covenants page on the Commonwealth Department of Environment, Water, Heritage and the Arts website.
The State Valuation Service can amend a land valuation if it is considered that the statutory covenant limits, or enhances, the use of the land to such an extent that it affects its value.
It is up to any landholder who has grounds to argue that this is the case to lodge an objection to a valuation within the applicable time limit. Before doing so, they should consult the Valuation of Land Act 1944 (Qld) (PDF)* and carefully read their notices of valuation for information on how to lodge an objection.
Local government may disregard the effect of annual valuation increases by rate capping, averaging and differential rating.
A farming exemption held under s.17 of the Valuation of Land Act is not automatically removed when rural land becomes subject to a statutory covenant. Farming concessional valuations will be lost if the farming business has ceased or will cease, and are assessed over the complete property, not just the parcel affected by the statutory covenant.
In many situations, having a statutory covenant on rural land is still consistent with using the land for farming, and may indeed enhance the value of the property (e.g. where a covenant prohibits using the land for non-organic farming).
In mature markets near urban areas, covenants may increase the value of the covenanted and surrounding land, due to the enhanced land management practices and premium payable for perceived 'eco values' associated with covenanted land.
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Last updated 13 May 2010