Receiving a settlement adjustment
Errors are often made when settlement adjustments are not added to the sale price of a property.
If you are registered, or required to be registered for GST, when you sell a property you may receive adjustments for costs such as council and water rates. These form part of the settlement amount on which the GST payable is calculated and will affect the amount you receive from the purchaser.
These adjustments are part of the amount payable for the property and you must include them on your activity statement at G1 and 1A.
- GSTD 2006/3External Link Goods and services tax: are settlement adjustments taken into account to determine the consideration for the supply or acquisition of real property?