Forum Replies Created
How did you determine it to be a new property, Terryw? Was it partitioned off a block of land or from your PPOR? From what I have been reading, if you are not registered and it is not a furthering of an enterprise then there should be no GST only CGT.
By the way, Terryw, though it is true the purchaser pays the GST and the vendor remits it to the ATO the practicalities seem to be the opposite. For example, if a block of land is valued by agents at $300k to achieve a sale and the price set by other land sales in the area (land sold as sub-divisions from PPOR land) then your ‘new’ land will need to be sold at $330k. Why would a residential purchaser pay an extra $30k? They wouldn’t. So the GST has done on of two things to the sale of land, either increased property prices by 10% across the board or developers are taking a 10% ‘haircut’ across the board. I might be completely off the planet with this logic, what do you think?
Yes, but this is where it gets interesting (or expensive). From what I am reading from the ATO site, the property is considered to be a partition ad therefore GST is payable (hopefully margin schemed) at point of partition. It seems the rulings are clear on this. But what does that mean for a future sale? (1) GST on partition into two titles (2) CGT on sale but then (3) GST on sale again as considered new property??? Surely this is overtaxing if that is the situation? It seems the partition GST and the CGT are correct, but surely GST wouldn’t apply again?
Yep, onto it. Thanks, duckster.
