GST Updates Affecting Private Clients and Private Business Owners

Purchasers of new residential properties to remit GST

From 1 July 2018, purchasers of newly constructed residential properties or new subdivisions will be required to remit the GST directly to the ATO as part of the settlement. 

Under the current law (where the GST is included in the purchase price and the developer remits the GST to the ATO), some developers have been failing to remit the GST to the ATO despite having claimed GST credits on their construction costs. The new measure is an integrity measure to strengthen compliance with the GST law and will ensure the relevant GST amounts will be remitted. 

Double taxation of digital currency removed

Starting on 1 July 2017, the GST treatment of digital currency (such as Bitcoin) will be aligned with the GST treatment of money. This measure will ensure purchases of digital currency are no longer subject to GST. 

Digital currency is currently treated as intangible property for GST purposes. Consequently, consumers who use digital currencies as payment can effectively bear GST twice: once on the purchase of the digital currency as it is currently treated as subject to GST, and again on its use in exchange for other goods and services that are subject to GST. 

Removing double taxation on digital currencies will remove an obstacle for the financial technology (fintech) sector to grow in Australia. 


Contact our Tax Consulting experts

If you have any questions about the above article, please contact our Tax Consulting experts:

Tony Nunes

B.COM, LLB, LLM, M.TAX, CTA

Client Director

P: (02) 9233 8866

E: tony.nunes@kellypartners.com.au


Peter Cohilj

B.BUS, M.TAX, CA

Senior Manager

P: (02) 9233 8866

E: peter.cohilj@kellypartners.com.au


Disclaimer:

While we have made every attempt to ensure that the information contained in this article has been obtained from reliable sources, Kelly+Partners is not responsible for any errors or omissions, or for the results obtained from the use of this information.