GST Articles

GST – Property Development

GST - Property Development There is only a liability to GST where: an enterprise is being carried on, the annual turnover is at least $75,000 ($150,000 for non-profit bodies) and a taxable supply is made. Therefore, when selling property there will be no GST liability unless all these requirements are met. The ATO has issued Miscellaneous Taxation Ruling MT 2006/1 on the meaning of carrying on an enterprise. In that ruling, the ATO states that in isolated transactions where land is sold that...

GST Property Traps

GST Property Traps The first issue to be resolved with any sale of real estate is whether there is a GST liability.  If there is, and none is collected from the purchaser and remitted to the Taxation Office (ATO), this is going to be an expensive exercise down the track when the ATO finds out. However, it should be noted there is only a liability to GST where: an enterprise is being carried on and the annual turnover is at least $75,000 ($150,000 for non-profit bodies) and a taxable supply is...

GST Margin Scheme

GST Margin Scheme Entities registered for GST and making taxable supplies can reduce their GST liability by choosing to calculate GST on the margin of real property supply.  Under the margin scheme, GST is calculated on the supply as 1/11 of the margin on the sale. The margin scheme is available on a taxable supply of real property made by: selling a freehold interest in land selling a stratum unit, or granting or selling a long-term lease (generally more than 50 years). Generally, the margin...