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This edited version has been archived due to the length of time since original publication.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: 1012967802428

Date of advice: 16 February 2016

Ruling

Subject: GST and the sale of property

Question

Is GST payable on the sale of the property by you?

Answer

No, GST is not payable on the sale of the property by you as the sale is not a taxable supply.

We are of the view that you are merely holding the title to the property without carrying on any activity in a businesslike manner and as such are not carrying on an enterprise.

Relevant facts and circumstances

A related entity transferred the title that it held to a vacant block of property (property) to you a few years ago.

You do not carry on any activity in a businesslike manner on this property.

You merely hold the title to the property for asset protection purposes.

You will be selling the property (which is a vacant block of land).

You do not have an Australian Business Number and you are not registered for GST.

Relevant legislative provisions

Section 9-5 of the A New Tax System (Goods and Services Tax) Act 1999

Reasons for decision

GST is payable on taxable supplies. A taxable supply is defined in section 9-5 of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act) as follows:

You make a taxable supply if:

    (a) you make the supply for *consideration; and

    (b) the supply is made in the course or furtherance of an *enterprise that you *carry on; and

    (c) the supply is *connected with the indirect tax zone; and

    (d) you are *registered, or *required to be registered.

    However, the supply is not a *taxable supply to the extent that it is *GST-free or *input taxed.

    (terms marked with asterisks (*) are defined in section 195-1 of the GST Act)

Given that you are not selling the property in the course of an enterprise that you are carrying on, and are not registered or required to be registered for GST, the sale of the property does not meet the requirements of section 9-5 of the GST Act and as such is not a taxable supply.