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Edited version of your written advice
Authorisation Number: 1012815412254
Ruling
Subject: GST and sale of family home
Question
Will you be required to charge goods and services tax (GST) when you sell the property located in Australia?
Answer
No, you will not be required to charge GST when you sell the property located in Australia because based on the information received the sale of the property will not be a taxable supply under section 9-5 of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act).
GST is payable on a taxable supply. A supply is a taxable supply where all the requirements in section 9-5 of the GST Act are met.
One of the requirements for a taxable supply is that the supply is made in the course or furtherance of an enterprise that the supplier carries on (paragraph 9-5(b) of the GST Act).
The definition of an 'enterprise' in subsection 9-20(1) of the GST Act includes (amongst other things) an activity or series of activities done in the form of an adventure or concern in the nature of trade.
Goods and Services Tax Determination GSTD 2006/6 and Miscellaneous Taxation Ruling MT 2006/1 explain that the mere disposal of a family home does not amount to trade.
Based on the information received, you use the property as your primary residence. In this instance the disposal of the family home will not amount to trade for GST purposes. You will therefore not be selling your family home in the course of an enterprise under paragraph 9-5(b) of the GST Act.
In this instance all the requirements in section 9-5 of the GST Act will not be satisfied. GST will therefore not be applicable when the family home is sold.
Relevant facts and circumstances
This ruling is based on the facts stated in the description of the scheme that is set out below. If your circumstances are materially different from these facts, this ruling has no effect and you cannot rely on it. The fact sheet has more information about relying on your private ruling.
You purchased a property in Australia. The property has two floors of equal floor space. You used the top floor as your primary residence and the ground floor for business purposes.
Since the closing of your business you have been using the whole building (that is both floors) as your primary residence.
You are not registered for GST.
Relevant legislative provisions
A New Tax System (Goods and Services Tax) Act 1999 Section 9-5