GST issues with wrapping / renting to buy

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From: Susan Pope


Hi Everyone,

Are there generally any GST issues with "wrapping" or "renting to buy"?

Thanks in advance.

Susan
 
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Reply: 1
From: Dale Gatherum-Goss


Hi Susan

No, there are no GST issues involved in wrapping unless you are playing with new homes.

You will need an ABN though.

Good luck

Dale
 
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Reply: 1.1
From: .watto .


Hi Dale,

You said...

"No, there are no GST issues involved in wrapping unless you are playing with new homes.

You will need an ABN though."

If there is no GST why do you need an ABN?

Please explain....


Cheers
Watto
Melb Freestyler
 
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Reply: 1.1.1
From: Dale Gatherum-Goss


HI Watto

Believe it or not, they are two different things.

An ABN is required for every business regardless of whether you are registered for GST, or not.

If you do not acquire an ABN, the people who pay you are required, by law, to withhold 48.5% of your payment and send it to the tax office instead of giving it to you.

Does this help?

Dale
 
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Reply: 1.1.1.2
From: .watto .


Thanks Dale,

That makes sense i hadn't thought about the with holding issue....

Cheers
Watto
Melb Freestyler
 
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Sim

Administrator
Reply: 1.1.1.1.1
From: Sim' Hampel


From the ATO website:

http://www.ato.gov.au/content.asp?doc=/content/Businesses/12660.htm

- - -
Is the ABN Compulsory?
All businesses with an annual turnover of $50 000 or more must register for GST and will need an ABN to do this. Organisations with a lower annual turnover may choose to register.

All non-profit organisations with an annual turnover of $100 000 or more must register for GST and therefore need an ABN.
- - -

So does this mean that anyone with over $50K in rental income should have an ABN and register for GST ?

 
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Reply: 1.1.1.2.1
From: Felicity W.


I have another question - I have an ABN as an individual, I also have a business name as a sole proprietor - can I use the same ABN for the business or do I need a new one?
Keep smiling
Felicity :cool:
 
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Reply: 1.1.1.2.1.1
From: Dale Gatherum-Goss


HI Felicity

They can be one and the same.

Dale
 
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Reply: 1.1.1.1.1.1
From: Dale Gatherum-Goss


Hi Sim

They're two different issues. Every business needs an ABN - regardless of it's income.

If the income is above $50k, then you must register for GST whilst, you if your income is below $50k, you have the choice as to whether or not to register.

Dale
 
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Sim

Administrator
Reply: 1.1.1.1.1.1.1
From: Sim' Hampel


Gotcha, thanks Dale.

So for people holding IPs in their own name, are they required to register for GST once they get over $50Kpa in income ? Or does this only apply to company and/or trust structures ?

 
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Reply: 1.1.1.1.1.1.1.1
From: Dale Gatherum-Goss


Hi Sim

No, residential IP's do not count in the $50k limit. However, non residential Ip's will such as commercial properties.

So, if you have rental income of $60kpa, you do not need to register for GST and may not even need an ABN unless you hold those Ip's through a trust.

Dale
 
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W

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Guest
Reply: 1.1.1.2.1.1.1
From: Susan Pope


Thanks to everyone who has replied to this post. I feel I have learnt so much in general from this website already.

Dale, just to recap, when my (rental) income gets to $50K would I be required to pay GST then? Or is GST only ever required to be paid on new houses?

Susan
 
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Reply: 1.1.1.2.1.1.1.1
From: Dale Gatherum-Goss


Hi Susan

No, assuming your rental income comes from houses, and not shops, or factories, you will not be required to register for GST, or charge it to the tenants.

This is regardless of your income level.

Dale
 
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