GST and Property
Goods and services (GST) applies to the supply of certain property types if the supplier (seller or vendor) is registered or required to be registered for GST purposes.
Property can be:
- Land
- Land and buildings
- An interest in land, rights over land or license to occupy land
“Supply” is defined as a 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
Generally you won’t be required to register for GST if:
- Your property transactions are for private use, such as constructing or selling your family home
- You only receive residential rent from your property
You may be required to register for GST, even if you are not a business, if:
- The turnover from your property transactions and other taxable transactions is more than the GST registration threshold
- You activities are regarded as an “enterprise”, for example – if you buy land with the intention of developing it for resale at a profit. Even a one-off property transaction may be considered an enterprise.
If you’re required to register for GST you need an Australian business number (ABN).
Residential rental properties
If you rent out property, you need to:
- Keep records right from the start
- Work out what expenses you can claim as deductions
- Work out if you need to pay instalments throughout the year
- Declare all rental-related income in your tax return
- Consider the capital gains tax implications if you sell
Further information on rental income and expenses can be found in the ATO Rental Properties 2020 booklet here: https://www.ato.gov.au/uploadedFiles/Content/IND/downloads/Rental-properties-2020.pdf