If you are selling property
If you're selling residential premises or potential residential land you must:
- notify the purchaser in writing (supplier notification)
- advise whether they need to pay a withholding amount from the contract price for the property or not
- state the withholding amount.
This can be included in the sales contract or in a separate document prior to settlement. Most states have updated their standard contracts to include this information.
If you have made a mistake on the notification, you must provide the purchaser with an amended one.
You may incur penalties if you fail to provide the required notice.
The purchaser pays the withholding amount directly to us at the time of settlement – instead of to you.
Reporting obligations
The standard elements of selling a property and reporting the GST on your sales apply.
On your business activity statement (BAS) you must report:
You receive a credit in your GST property credits account. This is the withheld amount paid by the purchaser. If there are multiple suppliers in the property transaction, it is your portion of the withheld amount.
This credit is transferred from the GST property credits account into your activity statement account when you lodge your activity statement for the relevant period.
If you're unsure of the correct GST treatment of the supply, we recommend you seek advice from us or your tax professional.
Conveyancers and real estate agents can assist purchasers to complete the forms. However, they can't provide GST advice unless they're registered tax or BAS agents.
For more information see GST at settlement – a guide for suppliers and their representatives.
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