Once the Treasury Laws Amendment (2017 Measures No. 9) Bill
2017 has been enacted, the responsibility for paying GST on
certain real estate transactions will shift from developers to
purchasers. This shift will require purchasers to withhold that
part of the purchase price representing the GST liability of the
developer and remit the withheld amount directly to the Australian
Tax Office ('ATO').
Currently, the purchase price paid to developers includes an
amount on account of GST. Developers are required to pay the GST
they collect to the ATO as part of their Business Activity
Statement at the end of each of their applicable reporting
periods.
These changes, originally proposed in the 2017-2018 Federal
Budget, have been introduced to address the growing trend of
developers collecting GST as part of the property purchase price,
and then taking steps to dissolve the company prior to remitting
the GST collected, effectively avoiding paying the GST collected to
the
