Goods and Services Tax Advice
GSTA TPP 069
Goods and services tax: Would the addition of four rooms onto the end of a six-room house constitute 'substantial renovations' so as to make the premises 'new residential premises'?
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Preamble
| This document is a ruling for the purposes of section 37 of the Taxation Administration Act 1953. It illustrates the principles contained in Goods and Services Tax Ruling GSTR 2003/3 on new residential premises. You can rely on the information presented in this document, which provides advice on the operation of the GST system. |
Answer
On this broad scenario, the addition of the four rooms would not amount to substantial renovations.
Background
A property owner adds four rooms onto the end of a six-room house. Only one existing room is affected - its end wall is removed to open it up to the added four rooms.
Explanation
Substantial removal or replacement of the structural components of a building is substantial renovation. However, if the existing rooms in the original building remain predominantly unchanged no substantial renovation has occurred.
In cases where there is no substantial removal or replacement of a building, but merely additions to the building, the building has not been substantially renovated. Therefore, if the existing rooms in the original building remain predominantly unchanged, the additions do not amount to substantial renovations. This is provided there is no removal or replacement of the structural components of the building (see paragraphs 68 to 79 of GSTR 2003/3). The addition of the rooms by itself would not amount to removal or replacement of a substantial part of the structural components of a building.
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Application of this GST Advice
This Advice is based on GSTR 2003/3. It explains our view of the law as it applied from 1 July 2000. You can rely on this Advice on and from its date of issue for the purposes of section 37 of the Taxation Administration Act 1953. Goods and Services Tax Ruling GSTR 1999/1 explains the GST rulings system and our view of when you can rely on our interpretation of the law in GST public and private rulings. If this Advice conflicts with a previous private ruling that you have obtained, this public ruling prevails. However, if you have relied on a private ruling, you are protected in respect of what you have done up to the date of issue of this public ruling. This means that if you have underpaid an amount of GST, you are not liable for the shortfall prior to the date of issue of this later ruling. Similarly, you are not liable to repay an amount overpaid by the Commissioner as a refund. |
Commissioner of Taxation
30 November 2005
Not previously issued as a draft
References
ATO references:
NO 05/3095
Related Rulings/Determinations:
GSTA TPP 068
Subject References:
new residential premises
substantial renovations
additions
building
Legislative References:
TAA 1953 37
| Date: | Version: | Change: | |
| You are here | 30 November 2005 | Original ruling | |
| 31 October 2012 | Consolidated ruling | Addendum | |
| 25 June 2014 | Withdrawn |