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  • Property and Construction Industry Partnership – issues register – section 07 – going concerns

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    (a) added, (u) updated, (w) withdrawn

    Issue number

    Index

    Date

    History

    7

    Going concerns

    7.1

    Can a sale of commercial premises be GST-free as a supply of a going concern under section 38-325 of the GST Act?

    29/10/2003 (u)

     

    "the GST Act"

    A New Tax System (Goods and Services Tax) Act 1999

    Relevant Rulings

    GSTR 2002/5 'Goods and Services Tax: when is a 'supply of a going concern' GST-free?'

    Relevant sections

    Section 38-325 'Supply of a going concern' of the GST Act

    Division 135 'Supplies of going concerns' of the GST Act

    7.1 Can a sale of commercial premises be GST-free as a supply of a going concern under section 38-325 of the GST Act?

    For source of ATO view, refer to the general principles in GSTR 2002/5 Goods and services tax: when is a 'supply of a going concern' GST-free?

    ATO position

    Yes, where all of the following conditions are satisfied:

    a. the sale is a supply under the following arrangement:

    i. the vendor supplies the purchaser with all of the things necessary for the continued operation of an enterprise

    ii. the premises is one of the things necessary for the continued operation of the enterprise

    iii. the vendor carries on the enterprise until the day of the supply.

    b. the supply is for consideration

    c. the purchaser is registered or required to be registered for GST

    d. the vendor and the purchaser have agreed, on or before the day of the supply, in writing that the supply is of a going concern.

    For more information about the sale of commercial premises and supply of a going concern, see GSTR 2002/5 Goods and Services Tax: when is a 'supply of a going concern' GST-free?.

      Last modified: 28 Jun 2010QC 16475