Sam Saad

If GST applies, stamp duty will normally be payable on the GST-inclusive purchase price, and this normally increases the purchase price and cost for a purchaser when they go to buy a property.

Generally, GST is payable in relation to commercial properties, but sometimes there's some exemptions that apply, and in particular, the sale of going concern when it comes to commercial property.

Yeah, that's a great question, Craig.

If a property falls under the sale of going concern exemption, GST will not apply to the sale of the property.

However...

In order for a purchase to be a sale of going concern, there are a few things that purchasers need to make sure they've got ticked off before they go ahead.

In my view, there's four main things.

Number one, the purchaser needs to be registered for GST.

A lot of people get this wrong, and particularly when they are buying properties through a trust.

Usually if you have a trustee company, you know, people think they need to register that company, but the key thing is that the trust is actually registered for GST.

That's an important component.

Number two, the seller also needs to be registered for GST.

This is very important, especially when you've got mum and dad sellers who have probably never had to register for GC in their life.

Three, both the purchaser and the vendor must have agreed in writing that the sale of going concern exemption applies.

And this usually happens in a contract for sale.

And number four, and finally, there must be a lease in place.

This must be in place before settlement and must go all the way through to after settlement.

If there's no lease in place, then this won't apply.

Yeah, that's right.

I mean, if you don't have it registered, the trust, that can cause a huge problem and could end up having buyers pay GST at a later point after the sale, something that they didn't even expect just because of a simple error like that.