GST Rules for Property Developers
The new financial year has seen a GST withholding obligation imposed from July 1.
The purchaser of certain residential premises, including some vacant land must withhold the GST component of the sale price and pay it directly to the Commissioner (rather than the seller)
The second topic is the new GST rules mainly for property developers. The GST needs to be withheld on the sale of some types of land and buildings, instead of paid when reported on the BAS.
Property developers will only be impacted by a GST withholding where they sell:
• Newly constructed residential premises, or
• Potential residential land subject to subdivision plan, to affected purchasers
The withholding rules apply to both sales and long term leases.
Purchasers must withhold these amounts from settlement funds and remit the amount directly to the ATO, with the amount paid to the ATO credited against the seller’s GST liability in its BAS.
For more information, contact your AMD Representative. Alternatively, speak to one of our specialists – Steven Florance or Shane Kaurin.