Private ruling: GST - groups and registration
Date of advice: 19 May 2026
Published: 3 August 2026
Ruling period: DD MM 20YY to DD MM 20YY
Date scheme commenced: DD MM 20YY

Ruling: Q1: Are you required to be registered for GST pursuant to section 23-5 of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act)with effect from DD MM 20YY? | A1: No. | Q2: Are you entitled to cancel your GST registration pursuant to section 25-55 of the GST Act with effect from DD MM 20YY? | A2: Yes, on the basis that you are no longer a member of a GST group.

Relevant facts and circumstances: You are an Australian company and have been registered for GST since 1 X 20YY. You are a member of a GST group and the GST group representative is <entity A>. <entity A> undertakes online sales and the delivery of goods within Australia and worldwide. On DD MM 20YY, you purchased a commercial warehouse located at xxx (the Property). Since the acquisition of the Property, <entity A> has used it to operate their business. There was no formal lease between you (as landlord) and <entity A> (as lessee). Instead, there was an informal (undocumented) occupancy arrangement which, required <entity A> to pay the ownership and holding costs. The ownership and holding costs consist of X, X, X and X. On DD MM 20YY, <entity A> sold its business and vacated the Property. Subsequently, the occupancy arrangement between ended. The purchaser of the business entered into a temporary occupancy arrangement with <entity A> for the period DD MM 20YY to DD MM 20YY so they could access the Property for minor activities including X, X, and basic tasks. The fee payable to <entity A> is approximately $xx. After this the Property will remain vacant and will not be used for any other purpose until it is sold to the third party purchaser. <entity A> will continue paying the ownership and holding costs of the Property for this period. You have entered into a contract to sell the Property to a third party purchaser for $xx. The expected settlement date is DD MM 20YY. Besides the Property in question, you do not own any other property. Other than the occupancy arrangement, you were not involved in the GST group's business. <entity A> will remove you from the GST Group with effect DD MM 20YY. When you exit the GST group the Property will not be made available to any other entity and no further income be derived from leasing or any other use of the Property until settlement. You have not undertaken any development activities in relation to the Property since acquiring the Property. From DD MM 20YY onwards, other than supplying of the property to <entity A> under the occupancy arrangement, you did not and will not conduct any activity, either within or outside the GST group. From DD MM 20YY to DD MM 20YY, your revenue will only include the proceeds from the sale of the Property.

Relevant legislative provisions: A New Tax System (Goods and Services Tax) Act 1999 section 23-5 | A New Tax System (Goods and Services Tax) Act 1999 section 25-55 | A New Tax System (Goods and Services Tax) Act 1999 section 188-10 | A New Tax System (Goods and Services Tax) Act 1999 section 188-15 | A New Tax System (Goods and Services Tax) Act 1999 section 188-20 | A New Tax System (Goods and Services Tax) Act 1999 section 188-25

Reasons for decision: Summary: Section 23-5 of the GST Act provides that you are required to be registered for GST if you are carrying on an enterprise and your GST turnover meets the registration turnover threshold. Subsection 188-10(1) of the GST Act further provides that you have a GST turnover that meets a particular turnover threshold if: • your current GST turnover is at or above the turnover threshold, and the Commissioner is not satisfied that your projected GST turnover is below the turnover threshold; or • your projected GST turnover is at or above the turnover threshold. Pursuant to paragraph 23-15(1)(b) of the GST Act and section 23-15.01 of the A New Tax System (Goods and Services Tax) Regulations 2019 (GST Regulations), the registration turnover threshold (for entities other than non-profit bodies) is $75,000. | Detailed Reasoning - Current GST turnover: Subsection 188-15(1) of the GST Act provides that your current GST turnover at a time during a particular month is the sum of the values of all the supplies that you have made, or are likely to make, during that month and the next X months. Subsection 188-15(2) of the GST Act provides the method of calculation of current GST turnover where you are a member of a GST group. As at DD MM 20YY, you are no longer a member of a GST group so you will calculate your current GST turnover under subsection 188-15(1) of the GST Act and include the value of supplies made to <entity A> for that month and the following previous X months. Subsection 188-15(2) of the GST Act does not apply. If on DD MM 20YY the value of supplies made by you to <entity A> in the current month plus the previous X months (in this case from DD MM 20YY to DD MM 20YY) exceeds the turnover threshold, your current GST turnover will be 'at or above the turnover threshold' pursuant to subsection 188-10(1) of the GST Act. What remains to be considered is whether your projected GST turnover exceeds the turnover threshold. | Detailed Reasoning - Projected GST turnover: Subsection 188-20(1) of the GST Act provides that your projected GST turnover at a time during a particular month is the sum of the values of all the supplies that you have made, or are likely to make, during that month and the next X months. From DD MM 20YY onwards, other than the sale of the Property, you will not make any further supplies. Section 188-25 of the GST Act states: In working out your *projected GST turnover, disregard: (a) any supply made, or likely to be made, by you by way of transfer of ownership of a capital asset of yours; and (b) any supply made, or likely to be made, by you solely as a consequence of: (i) ceasing to carry on an *enterprise; or (ii) substantially and permanently reducing the size or scale of an enterprise. (* denotes a term defined in section 195-1 of the GST Act) Goods and Services Tax Ruling GSTR 2001/7 Goods and services tax: meaning of GST turnover, including the effect of section 188-25 of projected GST turnover provides further explanation on what is meant by the term 'capital asset' (GSTR 2001/7). The meaning of 'capital asset' is discussed at paragraphs 31 to 36 of GSTR 2001/7 and states: | Detailed Reasoning - Meaning of 'capital assets': 31. The GST Act does not define the term 'capital assets'. Generally, the term 'capital assets' refers to those assets that make up 'the profit yielding subject' of an enterprise. They are often referred to as 'structural assets' and may be described as 'the business entity, structure of organisation set up or established for the earning of profits'. 32. 'Capital assets' can include tangible assets such as your factory, shop or office, your land on which they stand, fixtures and fittings, plant, furniture, machinery and motor vehicles that are retained by you to produce income. 'Capital assets' can also include intangible assets, such as your goodwill. 33. Capital assets are 'radically different from assets which are turned over and bought and sold in the course of trading operations'. An asset which is acquired and used for resale in the course of carrying on an enterprise (for example, trading stock) is not a 'capital asset' for the purposes of paragraph 188-25(a). Capital assets' are to be distinguished from 'revenue assets'. A 'revenue asset' is 'an asset whose realisation is inherent in, or incidental to, the carrying on a business'. 34. If the means by which you derive income is through the disposal of an asset, the asset will be of a revenue nature rather than a capital asset even if such as disposal is an occasional or one-off transaction Isolated transactions are discussed further at paragraphs 46 and 47 of this Ruling. 35. Over the period that an asset is held by an entity, its character may change from capital to revenue or from revenue to capital. For the purposes of section 188-25 the character of an asset must be determined at the time of expected supply. The Property was used as a leasing asset and not acquired for the primary purpose of resale at a profit. Since acquiring the Property, it has been used by <entity A> to operate its business under an occupancy arrangement. Consistent with the factors outlined in paragraphs 31 to 36 of GSTR 2001/7, we consider that the sale of the Property constitutes the transfer of a capital asset and a supply that will be made solely as a consequence of ceasing your enterprise. Consequently, section 188-25 of the GST Act is satisfied, and the sale of the Property will be excluded from the calculation of your projected GST turnover. | Detailed Reasoning - Conclusion: Accordingly, as your projected GST turnover will be below the GST turnover threshold from 1 July 2026 you will not be required to be registered for GST under section 23-5 of the GST Act (this is on the provision that you are no longer a member of a GST group). | Detailed Reasoning - Question 2: Section 25-55 of the GST Act states that: (1) The Commissioner must cancel your *registration if: (a) you have applied for cancellation of registration in the *approved form; and (b) at the time you applied for cancellation of registration, you had been registered for at least 12 months; and (c) the Commissioner is satisfied that you are not *required to be registered. Paragraphs 25-55(1)(b) and 25-55(1)(c) of the GST Act are satisfied as you have been registered for at least 12 months and is not required to be registered for GST (as outlined in the response to Question 1). You are entitled to cancel your GST registration. You can apply for cancellation in the approved form as required by paragraph 25-55(1)(a) of the GST Act. Once this is completed the Commissioner must cancel your GST registration.