Purchaser to remit GST on property transactions

 

In the opposite of regular taxable supplies, from 1 July 2018 the purchaser of new residential premises will be required to lodge and pay GST.

Usually it would be the vendor who would remit 1/11th of the sale price for new residential premises. However, due to non-compliance from developers in correctly calculating and remitting GST, an ATO approved form will be lodged on settlement by the purchaser.

A general transitional rule will be in effect for contracts entered into before 1 July 2018, where consideration for the supply is provided before 1 July 2020.

Source: Draft Legislation - Withholding GST from property transactions