OTP and GST

[Blueberry]

I was listening to Dymphna Boholt's podcast and she mentioned that if you buy an off the plan house, then GST is payable when you sell as you are considered to have built it (as you settle on the land first and then house is built).

I've been searching the archives and google to clarify, but I'm really lost. My understanding of a couple of posts is that if I rent it out for 5 years, then it is no longer considered new and GST is not payable. Is this the case?
Thanks

 

[Terry_w]

I was listening to Dymphna Boholt's podcast and she mentioned that if you buy an off the plan house, then GST is payable when you sell as you are considered to have built it (as you settle on the land first and then house is built).

I've been searching the archives and google to clarify, but I'm really lost. My understanding of a couple of posts is that if I rent it out for 5 years, then it is no longer considered new and GST is not payable. Is this the case?
Thanks

see subsection 2 A NEW TAX SYSTEM (GOODS AND SERVICES TAX) ACT 1999 - SECT 40.75
http://www.austlii.edu.au/au/legis/cth/consol_act/antsasta1999402/s40.75.html

 

[Blueberry]

Thanks for reply. I got a bit lost in the legalese, but after a good half hour going around in circles for definitions, I think that is a yes to the 5 years..

Now I think I may have a panadol and a little lie down

 

[Aaron_C]

I went to law school and I still don't understand the tax laws here. It's just ridiculous.

 

[Rob G.]

By "house" I presume that you are acquiring land and then building or appointing a builder as your agent.

Your intention must be to provide residential premises for at least 5 years at the time.

If your intention changes or your actual use within 5 years then you will need an adjustment.

If you are "buying off the plan" then you are purchasing residential premises under a conditional contract. The property will no longer be "new residential premises when you sell regardless of time because it has been sold before (to you).

You need to check your contract in detail.

Cheers,

Rob