Hi, my sister purchased a vacant land 5 years ago, and then a new house built up by a builder. This house has been rented out for 3 years since construction done. Now my sister try to sell it as cannot afford the mortgage due to no income from employment. Does the GST apply to this sale?
In general, GST is payable on the sale of new residential properties, and a property is still considered "new" when it has been rented out for less than 5 years. GST can be calculated using the margin scheme however, which reduces the amount of GST that needs to be paid to the ATO, but in this situation it is probably quite important that your sister sees a tax advisor to discuss. There are some circumstances where build to sell is not subject to GST, but generally that is just a situation where the property is built as part of subdividing the main home so it is considered realisation of a personal asset rather than being an enterprise of building to sell. You can start here for some reading on this topic: https://www.ato.gov.au/businesses-and-organisations/gst-excise-and-indirect-taxes/gst/in-detail/your-industry/property/gst-and-property?page=2#RegisteringForGST
15 Apr 2026 · 4 min read time
15 Apr 2026 · 8 min read time
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