| Disclaimer You cannot rely on this record in your tax affairs. It is not binding and provides you with no protection (including from any underpaid tax, penalty or interest). In addition, this record is not an authority for the purposes of establishing a reasonably arguable position for you to apply to your own circumstances. For more information on the status of edited versions of private advice and reasons we publish them, see PS LA 2008/4. |
Edited version of private advice
Authorisation Number: 1051828156026
Date of advice: 20 April 2021
Ruling
Subject: GST and sale of residential premises
Question
Is the sale of your property located at a specified address in Australia (the Property) a taxable supply?
Answer
No, the sale of the Property is not a taxable supply. You are therefore not liable to pay GST on the sale.
A sale is a taxable supply if it meets all the requirements of section 9-5 of the GST Act.
Section 9-5 of the GST Act provides that you make a taxable supply if:
(a) you make the supply for consideration
(b) the supply is made in the course or furtherance of an enterprise that you carry on
(c) the supply is connected with the indirect tax zone, and
(d) you are registered or required to be registered for GST.
However, the supply is not a taxable supply to the extent that it is GST-free or input taxed.
Based on the information that you have provided the sale of the Property does not meet all the requirements of section 9-5 of the GST Act and therefore it is not a taxable supply.
Relevant facts and circumstances
You purchased the Property on a specified date for a specified amount as an investment property. The Property is a residential property zoned R2. The land is approximately X acres and contains a X-bedroom house with an attached garage, which was built in 19XXs or 19XXs.
There are no commercial structures on the land.
There has been no change in the zoning of the Property since you purchased the Property. You have not made any changes to the land or the house. That is, you have not subdivided the land, demolished or substantially renovated the house or built any new structures on the land.
The Property is currently leased for less than $75,000 per annum. The Property has always been leased as residential premises for residential purposes. You have provided a copy of the lease agreement.
You have not used the land for commercial leasing or for any other commercial purposes at any point in time.
You do not own any other properties and have not bought, sold or developed any other properties before.
You do not carry on any other enterprise. Currently you are not registered for GST or required to be registered for GST.
You were registered for GST previously. You inadvertently applied for GST registration but were not required to be registered for GST as your annual turnover was less than $75,000.
You have not claimed any GST credits for the purchase of the Property or expenses associated with the Property.
You are in the process of selling the Property for a specified amount. The Property is not under contract yet.
Relevant legislative provisions
A New Tax System (Goods and Services Tax) Act 1999 section 9-5
A New Tax System (Goods and Services Tax) Act 1999 section 23-5
A New Tax System (Goods and Services Tax) Act 1999 section 40-65
A New Tax System (Goods and Services Tax) Act 1999 Division 188
Copyright notice
© Australian Taxation Office for the Commonwealth of Australia
You are free to copy, adapt, modify, transmit and distribute material on this website as you wish (but not in any way that suggests the ATO or the Commonwealth endorses you or any of your services or products).
