• Renting out a car parking space

    Do I need to get an ABN and register for GST?

    If you rent out a car parking space through apps like Parkhound, Spacer or similar, it can mean that you are running an enterprise. You will need to get an ABN and register for GST if either:

    • you earn, or are likely to earn, $75,000 or more per year renting out the car parking space or spaces
    • your turnover is, or is likely to be, $75,000 or more a year for all of the goods and services you provide while carrying on a number of enterprises.

    If you already have an existing enterprise for which you are registered for GST, you need to account for GST on amounts received for renting out a car parking space.

    Do I need to pay income tax on amounts received?

    Yes. If you rent out a car parking space, the payments you receive are assessable income. This means:

    • you must declare the income in your tax return
    • you can claim deductions for associated expenses.

    You may also need to pay capital gains tax when you sell the house or unit. Even if the house or unit is your main residence, renting out any part of it usually means losing part of your CGT main residence exemption.

    Example: determining if you need to pay GST

    John is a painter and is registered for GST. He owns a residential unit in a CBD location with a car parking space in the same building. John decides to rent the car parking space out for $330 a week through a facilitator who arranges for people to rent the space periodically. The supply of the car parking space is subject to GST. John will need to include the GST on this rent in his BAS.

    John receives $297 after the facilitator charges John a commission of $33. John must pay GST on the full $330 (that is, $30 GST). If the facilitator is registered for GST, John may claim an input tax credit of $3 for the GST included in the facilitator’s commission.

    John also includes the income, less the amount of GST, so $300 per week, from renting out his car parking space in his income tax return. He can claim a deduction for the fee, less the input tax credit, so $30 per week, charged by the facilitator and may have other deductions such as a percentage of his mortgage.

    End of example

    See also:

      Last modified: 07 Apr 2017QC 45171