Private ruling: GST and the sale of property
Date of advice: 16 February 2016
Published: April 2016

Ruling: Q1: Is GST payable on the sale of the property by you? | A1: 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: Summary: 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.