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This edited version has been archived due to the length of time since original publication. It should not be regarded as indicative of the ATO's current views. The law may have changed since original publication, and views in the edited version may also be affected by subsequent precedents and new approaches to the application of the law.

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Edited version of your written advice

Authorisation Number: 1012709411398

Ruling

Subject: GST and Compulsory Acquisition of Land

Question

Are you (as GST group representative) liable for GST on the land compulsorily resumed?

Answer

No.

GST is payable on a taxable supply. Section 9-5 of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act) outlines the conditions that must be satisfied in order for a 'taxable supply' to be made, which include that you must make a supply.

Paragraph 82 of Goods and Services Tax Ruling GSTR 2006/9 Goods and services tax: supplies (GSTR 2006/9) states that in cases where land vests in the authority as a result of the authority seeking to acquire the land, and initiating the compulsory acquisition process pursuant to its statutory right, then the owner does not make a supply because it takes no action to cause its legal interest to be transferred or surrendered to the authority.

Therefore, there was no supply made when the authority acquired the land by compulsory acquisition and the requirements of a taxable supply under section 9-5 of the GST Act are not met.

Consequently, as the representative member of the group liable for any GST payable pursuant to section 48-80 of the GST Act, you will not have a GST liability on the resumption of this land.

Relevant facts and circumstances

You are registered for GST.

You are a representative member of a GST group.

A Notice of Intention to Resume was issued.

The land was taken by way of publication of a Taking of Land Notice in the Government Gazette.

No approach to the government department requesting any land resumptions had been made.

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 9-10

A New Tax System (Goods and Services Tax) Act 1999 Section 9-40

A New Tax System (Goods and Services Tax) Act 1999 Section 48-40