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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Please note that the PDF version is the authorised consolidated version of this ruling and amending notices.This document incorporates revisions made since original publication. View its history and amending notices, if applicable.
Preamble
| This document was published prior to 1 July 2010 and was a public ruling for the purposes of former section 37 of the
Taxation Administration Act 1953
and former section 105-60 of Schedule 1 to the
Taxation Administration Act 1953.
From 1 July 2010, this document is taken to be a public ruling under Division 358 of Schedule 1 to the Taxation Administration Act 1953 . A public ruling is an expression of the Commissioner's opinion about the way in which a relevant provision applies, or would apply, to entities generally or to a class of entities in relation to a particular scheme or a class of schemes. If you rely on this ruling, the Commissioner must apply the law to you in the way set out in the ruling (unless the Commissioner is satisfied that the ruling is incorrect and disadvantages you, in which case the law may be applied to you in a way that is more favourable for you - provided the Commissioner is not prevented from doing so by a time limit imposed by the law). You will be protected from having to pay any underpaid tax, penalty or interest in respect of the matters covered by this ruling if it turns out that it does not correctly state how the relevant provision applies to you. [ Note: This is a consolidated version of this document. Refer to the Legal Database (http://law.ato.gov.au) to check its currency and to view the details of all changes.] |
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 applies [to tax periods commencing] both before and after its date of issue. However, this Advice will not apply to taxpayers to the extent that it conflicts with the terms of a settlement of a dispute agreed to before the date of issue of this Advice (see paragraphs 75 and 76 of Taxation Ruling TR 2006/10). |
Commissioner of Taxation
30 November 2005
Not previously issued as a draft
References
ATO references:
NO 05/3095
Related Rulings/Determinations:
TR 2006/10
GSTA TPP 068
Subject References:
new residential premises
substantial renovations
additions
building
Legislative References:
TAA 1953 Sch 1 Div 358
| Date: | Version: | Change: | |
| 30 November 2005 | Original ruling | ||
| You are here | 31 October 2012 | Consolidated ruling | Addendum |
| 25 June 2014 | Withdrawn |