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  • Glossary

    Residential premises

    • At its simplest, residential premises are premises containing basic living facilities that are fit for human occupation as residential accommodation.
    • The sale, or long term lease, of residential premises is input taxed except for two specific classifications of residential premises   
      • new residential premises (for example, houses, apartments and villas)
      • commercial residential premises (for example, hotels, motels and hostels).
    • if residential premises are input taxed it means that you don't charge GST if you sell it, and you can't claim back GST if you buy it, even if registered for GST.

    See also:

    New residential premises

    New residential premises are residential premises where any of the following apply to the premises:

    • they have not previously been sold (or subject to a long term lease) as residential premises
    • they have been created through substantial renovations (but note new residential premises of this kind are excluded from the withholding obligation)
    • they are new buildings which have been built to replace demolished buildings on the same land.

    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.

    See also:

    Potential residential land

    Potential residential land is land that it is permissible to be used for residential purposes but does not contain any buildings that are residential premises (for example houses and strata units).

    Local government zoning may permit a mixture of residential or commercial use but that is still considered potential residential land.


    The supplier is the entity(s) that is taken to have made the supply for the purposes of the GST law. This may or may not be the vendor under the contract or the registered proprietor on the certificate of title.


    The purchaser is the entity(s) that is taken to be the recipient of the supply for the purposes of the GST law.

    If the supply is a sale it is the entity that is buying the property or, if the supply is a long-term lease, it is the entity that is leasing the property.

    Purchaser's or supplier's representative

    Depending on which State or Territory the property is located in, the purchaser's or supplier's representative for the conveyancing process can include a:

    • licenced conveyancer
    • solicitor

    Note: Some jurisdictions may allow DIY conveyancing.

    Contract price

    In most cases, the contract price is the GST inclusive price of the supply as listed in the contract. The contract price may be varied by the parties before completion.

    The contract price is normally used for calculating the amount a purchaser needs to withhold from the supplier and remit to us. Using the contract price for this calculation provides certainty. Normal settlement day adjustments can be disregarded (for example, disbursements paid to reflect apportionment of council rates, water rates, etc).

    Price of the supply

    The price of the supply is usually the contract price but in certain circumstances the price of the supply may also include non-monetary consideration (for example, land swaps).

    If that is the case, the amount to be withheld by the purchaser needs to be calculated using the total consideration for the supply, and not just the monetary amount listed as the contract price.

    There are special rules for calculating the withholding amount where the contract is between associates and the contract price is less than the GST inclusive market value of the property.

    Long term leases

    Long term lease means a supply by way of lease, hire, or licence (including a renewal or extension of a lease, hire or licence) for at least 50 years if:

    • at the time of the lease, hire or licence, or the renewal or extension of the lease, hire or licence, it was reasonable to expect that it would continue for at least 50 years
    • unless the supplier is an Australian government agency – the terms of the lease, hire or licence, or the renewal or extension of the lease, hire or licence, as they apply to the recipient are substantially the same as those under which the supplier held the premises.

    Property subdivision plan

    A property subdivision plan means a plan for the division of real property that has been registered under an Australian law. For example, strata plans, community plans or subdivision plans registered with the relevant State or Territory Land Title Office.

    Registered entity acquiring land for a creditable purpose

    An entity will acquire property for a creditable purpose if they are registered for GST and they acquire it, to any extent, in carrying on an enterprise and the acquisition is not related to making input taxed supplies or of a private or domestic nature.

    Note, a purchaser under the margin scheme may acquire property for a creditable purpose although it isn't a creditable acquisition.

    You can check whether an entity is registered for GST by searching the Australian Business RegisterExternal Link. You can rely on a copy of the search on a relevant date.

    You can rely either on written correspondence from an entity, or a statement in the relevant contract, as to whether the entity is acquiring the land for a creditable purpose.

      Last modified: 08 Aug 2018QC 55431