Blog

Money Doesn’t Come Without Guidance ...

Awesome Image
24
May
  • Posted By : Administrative
  • Category: General Tax Topic
  • Comments: 0

WHAT IS GOODS AND SERVICES TAX (GST) - MARGIN SCHEME? WHEN CAN AN INDIVIDUAL USE GOODS AND SERVICES TAX (GST) - MARGIN SCHEME?

You’re planning to sell a property of your business but you are not sure about the GST implications. There is a margin scheme which is also a way of working out the GST you must pay when you trade property as part of your business. You can only apply the margin scheme if the trade of the property is taxable. One-eleventh of the total sales price is the sum you normally need to pay for GST on a property sale.
You can use the margin scheme depending on by what means and at what time you first acquired your estate. For GST uses, the date when payment for the property was made would be the date that you have purchased the property. You can use the margin scheme if either:

  • You purchased the property before July 1, 2000; or
  • You purchased the property after July 1, 2000 from someone who:  
  1. was not registered or required to be registered for GST (the initiation of GST);
  2. sold you an existing residential premise; 
  3. sold the property to you as part of a GST-free going concern or GST-free farmland;
  4. sold you the property using the margin scheme.

You need to fulfil certain obligations to use the margin scheme. These may vary depending on the purchase and/or selling date of the property. In terms of the purchase date, the requirements may vary depending on whether you purchased your property-

  •  before July 1, 2000;
  •  on July 1, 2000 or after that;
  • on or after December 9, 2008.

In terms of selling, the requirements may vary depending on whether you make the sale- 

  • on or after March 17, 2005; 
  • on or after June 29, 2005.

Comments 0

    Currently, there are no comment.

Login to comment

Latest Posts

Popular Post

We provide the fastest, easiest and most effective online tax return solution