Private ruling: GST and the sale of residential premises
Published: April 2015

Ruling: Q1: Was the sale of the Property an input tax supply of residential premises under section 40-65 of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act)? | A1: Yes. The sale of the Property was an input taxed supply of residential premises to be used predominantly for residential accommodation. The house has physical characteristics evidencing its suitability and capability for residential accommodation and the balance of the land is to be enjoyed with the house.

Relevant facts and circumstances: You are registered for GST. You are a property developer. On DDMMYYYY you acquired the Property. There was no GST on the supply. The Property consists of residential premises and X hectares of land on one title. There are X livestock paddocks. You acquired the Property for the purposes of property development. The Property has been used as a residential rental property since acquisition. The Property was recently vacated. The land was not used for farming. You were approached by a Property Developer (the Purchaser) and made an offer to purchase the Property. On DDMMYYYY you entered into a Contract of Sale of Real Estate (Contract) with the Purchaser for $X GST Exclusive. You have provided a copy of the Contract. The Purchaser was granted access to the Property for the purpose of, progressing, their development application and using the house as an office. None of the roads or any other structural improvements that were set out in the contract were made to the land. No structural changes have been made to the house other than painting. A plan of subdivision for the Property has been approved by Council and the Purchaser will develop the Property. The settlement of the Property occurred on DDMMYYYY.

Relevant legislative provisions: A New Tax System (Goods and Services Tax) Act 1999 Section 9-5, and | A New Tax System (Goods and Services Tax) Act 1999 Section 40-65.