Legislative developments – 2011 – GST treatment of new residential premises

The legislation received Royal Assent on 21 March 2012

Link to ATO Administrative treatment – here

Background to legislation

Summary

  • The proposed amendments intend to clarify how the GST applies to the sale of new residential premises by builders and developers from 27 January 2011.  The amendments will ensure that the sale of newly constructed residential premises to home buyers and investors is subject to GST even though there may have been an earlier ‘wholesale supply’ of the premises.  The amendments were introduced following the decision of the Full Federal Court in Commissioner of Taxation v Gloxinia Investments (Trustee) [2010] FCAFC 46
  • The proposed amendments will not apply to sales of residential premises constructed under eligible arrangements entered into prior to 27 January 2011 and to sales after 27 January 2011 if the supply is made because of a property subdivision plan lodged before that date.

Links to documents

Exposure draft of Legislation

Media releases

  • No 134/2011 issued on 23 September 2011 by the Assistant Treasurer
  • No 020/2011 issued on 27 January by the Assistant Treasurer

Consultation

  1. Corporate Tax Association
  2. Greenwoods & Freehills
  3. Law Council of Australia
  4. Property Council of Australia
  5. Tax Institute
  6. The Institute of Chartered Accountants in Australia
  7. The Law Society of NSW

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