Reply: 2.1.1.1.1.1.1.1.1
From: Dale Gatherum-Goss
Hi!
Welcome to my world!!!! And you guys wonder why i don't sleep. I'm afraid to!!
Seriously, I'll try again . . .
>My understanding is that if a
>Developer builds a new
>residential property ( not
>built under margin scheme as
>input tax credits cannot be
>claimed ),
The developer buys land. The purchase price may or may not include GST depending upon the vendor.
If the vendor elects to use the margin scheme, the purchase will include a lower amount of input credits available to the purchaser to claim back from the tax office in his BAS.
Normally, when the developer sells that property, it is deemed a new property and he will sell it inclusive of GST.
If the Developer bought the land without there being GST in the price, or he bought it before GST came into play (ie, before June 2000) then the developer can elect to use the margin scheme to reduce the amount of GST that is included in the sale to Joe Public.
If this is so and the
>purchaser is registered for
>GST, then the purchaser should
>be able to claim back the GST
>content?
Depends upon who is the purchaser here. If it is Joe Public and he will use the house for a rental property. No he cannot claim back the GST, even if he is registered.
Did I understand your question properly?
.When the purchaser then decides to sell the
>property later on they must
>then also pay to the ATO the
>GST on the sale price.
If the purchaser sells a house that has been sold previously, then there is no GST included in the sale.
>But you >have said that secondhand
>residential property does not
>attract GST.
That is correct, see above. Unless (and don't you just hate that!) you have somehow created a new property out of the old property through a substantial renovation or perhaps even a sub-division or strata title according to the tax office.
This would mean that the purchaser gets a GST
>refund on purchase buy does
>not pay on resale. This
>effectively reduces the
>purchase cost. What am I
>missing?
See my earlier paragraph, this might now be clearer.
Also this would apply if the purchaser de-registered before selling. I don't see
>the ATO paying out without getting something back at some
>point.
>
I'm not sure that I understand you properly. But, I'm hopeful that my earlier para's will make a difference. let me know either way, huh?
Have fun
Dale
>My head hurts.
You need more alcohol or chocolate (see that post a few days ago!!)