Just thinking of ways around having to pay for GST on a splitter block and new build as it will be a massive tax for me. Say I demolish my IP, subdivide and build 2 new houses. I want to keep one of the house long term so I rent it out immediately. The other house I claim as a PPOR and move into it immediately post build. After a year I sell it off. Will this still attract GST?
Do you pay GST on a new build as PPOR but then sell within 5 years?
- Thread starter eggnog
- Start date
see
http://www.austlii.edu.au/au/legis/cth/consol_act/antsasta1999402/s40.65.html
And the definition of 'new residential premises'
http://www.austlii.edu.au/au/legis/cth/consol_act/antsasta1999402/s40.75.html
http://www.austlii.edu.au/au/legis/cth/consol_act/antsasta1999402/s40.65.html
And the definition of 'new residential premises'
http://www.austlii.edu.au/au/legis/cth/consol_act/antsasta1999402/s40.75.html
Almost certainly. The issues are complex and explained in ATO MT2006/1 which relates to an ABN. The same views are equally shared for GST so its a good start point for the GST issues.
However the amount of GST may not be 1/11th of the sales price if you are eligible to use the margin scheme. The costs to build may also include GST which may be partially eligible as a input tax credit at the time of sale also.
You may be better off focussing on estimating the pre-tax and post-tax merits of the proposal that allows for GST and income tax on any profits. The only way to avoid is illegal but minimising is a legitimate approach.
