ARTICLE · 21 DECEMBER 2013

Property and funds management update

Moore Australia

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The GST reverse charge mechanism for going concerns and farm land will be proceeded with and MIT reforms are expected.

AustraliaTax

Stephen O'Flynn

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There were limited announcements made that are relevant to the property and funds management industries in the MYEFO. The GST reverse charge mechanism for going concerns and farm land will be proceeded with and we still await details of the MIT reforms.

GST: Reverse charge for going concerns and farm land

The Government has announced 'reverse charge' rules relating to the sale of business and farm land. Currently a 'going concern' exemption is available for the sale of an operating business. For the sale of farms under the GST Act, it allows the sale to be treated as GST-free.

The 'reverse charge' rules originally announced by the Labor Government in the 2009-10 budget seek to remedy the problems facing between the interaction of the GST-free exemptions and other provisions of the GST Act. As a result the reverse charge rules look to treat the sale of a 'going concern' or 'farmland' as a taxable supply (taxed at 10%) and upon a written agreement between both

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