I'm trying to understand the specific criteria that causes GST to be applicable to the purchase of an established residential property. The property in question is well established, was originally constructed as a residential property and currently displays residential characteristics, ie. bedrooms, bathrooms, kitchen. It's not set up as a showroom, warehouse, medical suite etc. However, it's located alongside other residential properties in a mixed-use neighborhood. I understand the immediate previous use of the property was being leased to a business who used at least part of it as an office. I'm unsure if the current property owner is a going-concern, but even if they are, it has been leased out to a third party. That business has now vacated and it's being offered for sale as a residential property. Given its residential appearance and the fact that it would be used for a residence post- purchase, I'm trying to wrap my head around why it's 100% GST taxable.
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Sale of established residential property is input taxed (GST exempt).
ATO information in link
GST and residential property | Australian Taxation Office
"A property that displays the physical characteristics to provide residential accommodation is a residential property even if it is used for a different purpose. For example, where a residential property is used as a business office."
Thanks for the reply - this is the part that I understand. However, there's also a clause on this page: "GST only applies to the sale of certain property types if the seller (vendor) is registered or required to be registered for GST purposes." If it qualifies as a residential property, however the vendor is registered for GST - could this be why GST is being applied to the purchase price?
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