GST After Two Years?

[HotRod]

Just received an email from the previous owner (seller, who was the builder) of a residential strata property we purchased almost two years ago requesting us to sign a document saying the sale was subject to the margin scheme and he was liable for the GST in the sale.

Now, this is not stated anywhere in the contract we signed at the time, nor have we ever received a Tax Invoice for the sale stipulating where GST was payable.

The purchase price was $870K with no mention of GST.

My understanding now is that the purchase price is still $870K but now with about $79K GST payable by the previous owner.

I have sent this off to my settlement agent at the time to get his input and then I will be off to my accountant.

As a second opinion I'm asking here.

I'm thinking that I'm not signing anything until I have received a receipted tax invoice with valid ABN for GST registration. But I guess that will be confirmed in time.

Views????

 

[mattnz]

I imagine they will be happy to provide you with these documents.

I am guessing that the following has happened:
The contract didn't mention the margin scheme
They have since been audited by ATO
They now need to claim under the margin scheme or have to pay alot more gst
You would be doing them a huge favour that will save them thousands

Just received an email from the previous owner (seller, who was the builder) of a residential strata property we purchased almost two years ago requesting us to sign a document saying the sale was subject to the margin scheme and he was liable for the GST in the sale.

Now, this is not stated anywhere in the contract we signed at the time, nor have we ever received a Tax Invoice for the sale stipulating where GST was payable.

The purchase price was $870K with no mention of GST.

My understanding now is that the purchase price is still $870K but now with about $79K GST payable by the previous owner.

I have sent this off to my settlement agent at the time to get his input and then I will be off to my accountant.

As a second opinion I'm asking here.

I'm thinking that I'm not signing anything until I have received a receipted tax invoice with valid ABN for GST registration. But I guess that will be confirmed in time.

Views????

 

[sanj]

I agree with Matt here. It really will not affect you in the slightest way Hotrod, you'll just be helping them out, no harm done.

Not sure why you need an invoice etc since you are unable to claim anything.

 

[HotRod]

I agree with Matt here. It really will not affect you in the slightest way Hotrod, you'll just be helping them out, no harm done.

Not sure why you need an invoice etc since you are unable to claim anything.

Just so it spells out exactly what's what.

 

[sanj]

Just so it spells out exactly what's what.

But it is entirely irrelevant to you is it not? It is GST paid by the seller to the ATO and not claimable by you

 

[HotRod]

But it is entirely irrelevant to you is it not? It is GST paid by the seller to the ATO and not claimable by you

Might be, but is that not the same when you go shopping for a pair of shoes???

There's no need for a receipt showing the GST because you can't claim it, but you still get one showing it.

Same as when you buy a car. The purchase contract spells out GST, luxury car tax etc etc but I don't give a toss about that, but still want it to know.

Feel more comfortable getting one spelling out exactly what was taxable and how much was paid.

 

[sanj]

Feel more comfortable getting one spelling out exactly what was taxable and how much was paid.

Yeah fair enough, i can understand that.

 

[Terry_w]

You might want to seek legal advice on this one. From a GST perspective and a fraud perspective.

 

[HotRod]

You might want to seek legal advice on this one. From a GST perspective and a fraud perspective.

My accountant is thinking the same.

 

[Ausprop]

the ATO often give grace to sellers to get agreement for the margin scheme to apply which is almost certainly what is happening here.