GST registration

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From: Anonymous


Hi forum,

If you are registered for GST can you claim back the GST on the purchase of a property (either house or land or both) if it's for investment purposes. Does it make a difference if you buy the property as an individual or as a company.

I know I need to ask an accountant - but if anyone thinks they might know from their own experience that'd be great.

ta
 
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Sim

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Reply: 1
From: Sim' Hampel


I assume you are referring to new houses, since no GST is applied to residential housing that was built pre-July 2000 ?

 
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Reply: 1.1
From: Anonymous


Yeah sorry that's what I mean.

Thanks again
 
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Reply: 1.1.1
From: Tasha Hungerford


Hi,
Just wanted to let you know that yes you could claim the GST on a new property that you purchased....however the problem is that once you register yourself for GST and list your business as real estate investing or whatever term u r going to use, you are admitting you are in business to the ATO. So any capital gains tax concessions will no longer be available to you,as any profit or loss you make will have to be taken in full. Hope I havent confused you too much! Try this link to ATO website
http://www.taxreform.ato.gov.au:80/ind_partner/property/issues/11.htm

By the way, im an accountant if that helps my credibility!
 
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Reply: 1.1.1.1
From: Anonymous


Thanks Tasha,

If you where purchasing in a company there wouldn't be any capital gain discounts would there? - as with the case of investing as an individual

Assuming of course that the company earns the required threshold amount to be registered for GST - or for it to be worth while claiming.

ta
 
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Reply: 1.1.1.1.1
From: Michael Yardney


As you say -you should gets accountant's advice but, having bought my share of residential property as I understand it.....
As residential rents are not subject to GST, if you are buying a new residential property for investment purposes, be it in your own name or in a company you can't claim the GST as an input credit and get a deduction.
All you do is claim it as part of your capital cost base.
Nor can you claim back the GST component of agents rental collection commissions or those for repairs.
You just claim the full cost including GST as a revenue expense.
On the other hand you can claim the GST as an input credit if you are buying commercial property.
Michael Yardney
Metropole Properties
 
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