Do I have to pay GST?

[WBG Redcliffe]

Hi all,

Just built a duplex and hand over is next week. If I sell at 340k and my costs were around 280k aside from agent and CGT do I have to pay GST. I have been told I do.

I am not a company and do not have an ABN etc. The building is in my own name.

If I do will it be 10% of the profit component as I did not claim GST as the construction proceeded?

Hope this question makes sense.

thanks in advance

Wayne

 

[james_w]

Hi all,

Just built a duplex and hand over is next week. If I sell at 340k and my costs were around 280k aside from agent and CGT do I have to pay GST. I have been told I do.

I am not a company and do not have an ABN etc. The building is in my own name.

If I do will it be 10% of the profit component as I did not claim GST as the construction proceeded?

Hope this question makes sense.

thanks in advance

Wayne

Hi, wayne I have done similar properties after seeing my accountant in maryborough that deals with traders and developers we paid 10% all up on tax on 50k profit projects so around $5000 however there is not alot of accountants around who deal with these types of taxes so your best bet would be to find one of these accountants as what you have done I believe comes under traders tax if you sell once handed over or even right now you will not pay cgt as this was a pure build and sell I could be wrong but I have done this several times including asking the ATO directly

 

[fernfurn]

I realise you havent an abn, but If you had an ABN, and you had paid gst on all your purchases, then you should be able to claim that gst back and pay the gst only on your sell price. Can you do the same thing if you are a trader without an abn?
So James are you saying that even if you are not set up as a business/developer you can still present this to the ato as a business venture, and put the profit into your income and only pay normal tax. So it would depend on your level of income/tax rate whether you would be better off paying cgt which would be on only 50% of your profit

 

[james_w]

I realise you havent an abn, but If you had an ABN, and you had paid gst on all your purchases, then you should be able to claim that gst back and pay the gst only on your sell price. Can you do the same thing if you are a trader without an abn?
So James are you saying that even if you are not set up as a business/developer you can still present this to the ato as a business venture, and put the profit into your income and only pay normal tax. So it would depend on your level of income/tax rate whether you would be better off paying cgt which would be on only 50% of your profit

Hi, celica exactly our first h&l which was a pure build and sell, even though we had no abn at the time was presented as a business venture and our costs was 5k , however we were only on 35k a yr at the time. As I mentioned though you really need to find an accountant who has experience with this otherwise just any old accountant will expect you to pay cgt if we went this way we would of had to pay 25k instead of 5k I am sure others on here have done the same thing.

 

[AUSPROP...]

you need to pay GST and then what is left is assessed as taxable income i.e. you don't qualify for the 50% reduction. go to www.bantacs.com.au and rwad Julia's book called "how not to be a developer"