Private ruling: Residential premises
Date of advice: 24 August 2016
Published: September 2016

Ruling: Q1: Is your supply of the premises located at specified address input taxed under section 40-65 of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act)? | A1: Yes, your supply of the premises located at specified address is input taxed under section 40-65 of the GST Act. The residential premises are not new residential premises. The premises have not been created through substantial renovations of a building.

Relevant facts and circumstances: You are registered for GST. You own property. The premises were designed and built as residential premises. The property has been unoccupied since specified date. They were in a deteriorated condition in specified year, but they remain structurally intact and retain most of their key features from the specified year. They are being prepared for disposal. The premises have always been residential properties since their original construction. The premises are not part of a resort, serviced apartments or hotel type setting. The premises were not built, nor do they contain a building that has been built, in place of demolished premises that were on the same land. The existing dwellings are the only ones that have ever been built on the land. You do not intend to apply the margin scheme when you dispose of the property. You are renovating, repairing and modifying the premises prior to marketing the premises for sale. None of the works involve construction of additions, construction of new buildings on vacant land, removal or replacement of foundations, removal or replacement of internal walls, removal or replacement of roof structures or staircases. Some external walls will be removed as described below. Removal or replacement is confined primarily to replacement of metal roof sheeting, gutters and downpipes. You have replaced the front verandas. Specified entity will selectively replace defective electrical and plumbing services. The bathrooms and the kitchens are the main areas in which intrusive fixtures and fittings will be removed. The items removed will include cupboards, toilets, bathtubs, sinks and ovens. The bedrooms, lounges and dining areas are not affected. Nothing was nor will be removed from the bedrooms, lounges and dining areas. The bedrooms, lounges and dining areas never had any built in cupboards. There is only some rewiring that will take place within the wall in the bedrooms, lounges and dining areas. All specified premises will be stripped of existing cupboards and bathroom/toilet appliances. No kitchen, bathroom or laundry fit outs will be carried out with the possible exception of one residence as described below. You will not install any floor coverings, curtains or other soft fittings to any of the premises The premises are being created from residential premises that will become the subject of a property subdivision plan. We note for your information that a property subdivision plan is a plan for the division of real property and that is registered (however described) under an Australian law.

Relevant legislative provisions: A New Tax System (Goods and Services Tax) Act 1999 - section 40-65 | A New Tax System (Goods and Services Tax) Act 1999 - section 40-75