GST and Property

Tax payers or individuals who want to sell, give on lease or transfer the lease are required to register Goods and services tax (GST) on property by ATO guidelines.

In this stage we usually speak more common words like property instead of using the legal term “real property”.

Property can be defined as:

  • land
  • land and buildings
  • an interest in land, rights over land or licence to occupy land of individual

By ATO term of supply includes sale, lease, transfer of rights, or similar dealings in property.

The GST treatment of property varies depending on the type or its purpose.

Property and registering for GST

You don’t need to registered GST if:

  • If you do your property transactions are for private purposes rather than work purposes, such as constructing your home or selling your home
  • you only receive residential rent from your property rather than business purposes

However,You need to registered your GST, even if you are not a business transactions, 

If you have:

  • The property transaction of your business  and other taxable transactions is greater than GST threshold amount
  • your activities are Considered as ‘entity’ or ‘enterprise’ for example –  If you buy land or house for profit purposes and again resale for more money and only intention to gain profit. So here, one-off property transactions may be related to an enterprise.

If you really want to register for GST, You need to require ABN first.

If you’re required to register for GST you need an ABN.

For more information on online tax return 2020, Tax Return 2020, myGov 2020, myTax 2020 or any other tax related matter, please call our professional accountant on 1300 768 284 or you can email us at enquiry@taxrefundonspot.com.au

What’s the difference between a repair and an improvement?

Repairs means fix the damages of a property. for example changing part of a damaged fence.

Whereas maintenance means main the property, For example, oiling a machine.

Any cost incurred in rental property, you are entitled to claim 100 per cent an expenses as deduction.

A capital enhancement occurs when the situation or value of an item is enhanced beyond its original state at the time of obtain.

This would be classified as capital deduction and plant and equipment depreciation over the time.

An example of a capital works deductions could be replacing the kitchen items. If any plant and equipment items are removed and replaced, for example an air conditioner, this will also be considered a capital improvement.

For more information on online tax return 2020, Tax Return 2020, myGov 2020, myTax 2020 or any other tax related matter, please call our professional accountant on 1300 768 284 or you can email us at enquiry@taxrefundonspot.com.au