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  • When a purchaser has a withholding obligation

    You will have a withholding obligation if you are the recipient of a taxable supply, by way of sale or long-term lease where you provide any consideration (for example, make a payment other than a deposit) on or after 1 July 2018, of either.

    • a new residential premises
    • potential residential land included on a property subdivision plan.

    A supply of new residential premises or potential residential land in Australia will be a taxable supply if your supplier is registered (or required to be registered) for GST and the supply is:

    • made for consideration
    • made in the course or furtherance of an enterprise the supplier carries on
    • not a GST-free or input taxed supply (for example a supply made as part of a GST-free supply of a going concern or of GST-free farmland)

    Note: Residential premises cease to be new residential premises if they have been used solely for renting for a period of at least five years since they were constructed.

    You do not need to register for GST because of a withholding obligation.

    Transitional arrangements apply to contracts entered into before 1 July 2018.

    See also:

    Excluded supplies

    You will not have a withholding obligation in respect to the following supplies of new residential premises or potential residential land for:

    • new commercial residential premises (for example, hotels and motels)
    • existing premises that have been substantially renovated
    • potential residential land that contains a building that is currently in use for a commercial purpose (for example, a factory or shop being operated in an area where local zoning permits mixed use)
    • potential residential land supplied to a GST registered entity for a creditable purpose.

    See also:

      Last modified: 07 Aug 2018QC 56253