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Edited version of private advice
Authorisation Number: 1051820128917
Date of advice: 24 March 2021
Ruling
Subject: GST and residential property
Question 1
Is the sale of residential property in the course or furtherance of an enterprise pursuant to section 9-5 of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act)?
Answer
No, the sale is not in the course or furtherance of an enterprise and all the requirements of section 9-5 of the GST Act are not satisfied.
Question 2
Does the sale of the Property constitute an input taxed supply pursuant to section 40-65 of the GST Act?
Answer
Yes, the sale of the Property constitutes an input taxed supply pursuant to section 40-65 and should not include GST.
Question 3
Will the sale of the Property be excluded from GST withholding at settlement?
Answer
Yes. However, you must notify the purchaser in writing they do not have a withholding obligation as you are selling residential premises that are input taxed.
Relevant facts and circumstances
You do not have an ABN or GST registration.
You are not a professional property developer.
You purchased the property in 20XX and moved into it thereafter.
Soon after you and your family moved in, you realised the house was too small to accommodate the needs of your immediate family, especially with your parents and siblings visiting from overseas often.
In 20XX, you decided to build a duplex to accommodate your family's future needs.
The building of the duplex was completed in 20XX.
You moved into one unit of the duplex as soon as practical and are still living there. You have never rented it out.
Your spouse went overseas in 20XX and never returned.
You rented out the other unit of the duplex starting from 20XX.
You commenced and finalised divorce proceedings in 20XX.
Due to financial reasons, you are wanting to sell the unit of the duplex that you are living in.
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