We are a property developer and just completed a building. Some of the units are leased and some sold. If one of the leased units is sold with an existing tenancy, are we required to pay GST or is this treated as a supply of going concern and exempt from GST?
Hi @chrisbl
Whether you need to pay GST depends on if the sale qualifies as a going concern. A going concern sale is GST-free when specific conditions are met.
You're selling a going concern if the sale includes everything necessary for continued operation and the business is carried on until the day of sale. A fully tenanted building where the property and all leases, agreements and covenants are included in the sale can qualify as a going concern.
A sale of a going concern is GST-free if:
If these conditions aren't met, you'll generally need to pay GST on the sale as it would be a taxable supply. You can find more information about selling a going concern on our website.
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