GST/Developments and Timeframe

[MTR]

Hi
Can anyone help, I am currently in the process of developing and offloading some properties and strategically trying to work through this.

I was told that ATO allows a timeframe of up to 2 years to lodge GST, I assume this is from the date you commence development/house demolished?? I will be using the margin scheme.

Thanks
MTR

 

[Paul@PFI]

Not correct. You are required to report and pay quarterly in most cases when you make a taxable supply. Tax is due within 28 days of the end of the quarter. Unless registered for GST the margin scheme cant even be used. So 1/11th would be due. Its sadly common. The seller doesn't register until after the sale when the tax problem is detected. Already the margin scheme is lost.

You may need an ABN now. It may be practical to register for GST now. If you do claim anything the ATO will send your their checklist to audit your eligibility. It is intended to detect fraud and error. Copy attached below.

Personal tax advice that meet with your proposal is needed. For example you will incur GST on costs such as the demo. And many other costs incl tree clearing, architects, DA fee, etc... Can you claim them ? How much can you claim and when ? How will your records reflect GST and how will you apportion the cost both including and excluding GST. Get it wrong and you will overpay or underpay income tax and/or GST.

 

[MTR]

Thanks Paul

I am registered for GST.

I have just sold my first development - 2 blocks and have included the GST Annexure (Margin Scheme) as part of the contract.

I am meeting with my accountant in 2 weeks so we can go through everything, fun and games


MTR

 

[Blacky]

If you are already registered for Gst, then aren't you completing quarterly BAS?

 

[Paul@PFI]

All sounds good.

The GST you pay at the end of the quarter can be reduced by the GST on same portion of construction costs etc if its hasn't already been claimed. Some instruct their solicitor to draw a cheque for the GST at settlement. This is common if your registration is annual GST. (Rare) But its not mandatory unless the ATO garnishee it.

 

[MTR]

If you are already registered for Gst, then aren't you completing quarterly BAS?

No, but there is more to it and I need to speak to my accountant as I don't want to go into the details here until I have further information.

Cheers
MTR

 

[MTR]

All sounds good.

The GST you pay at the end of the quarter can be reduced by the GST on same portion of construction costs etc if its hasn't already been claimed. Some instruct their solicitor to draw a cheque for the GST at settlement. This is common if your registration is annual GST. (Rare) But its not mandatory unless the ATO garnishee it.

Thanks that is great