Author: JayATO(Community Support)Community Support 18 Mar 2026
Hi @newbiebuild,
You can use the margin scheme if the property sale is taxable and you meet the eligibility requirements. The key factor is whether the person you bought the land from in 2009 was registered for GST at the time of that purchase.
The margin scheme is generally available when you purchased the property from someone who wasn't registered for GST, or when the supplier didn't include GST in the sale price. Since you bought the land in 2009 from a developer and your 'Transfer of land' document doesn't mention GST, this suggests the margin scheme may be available to you. However, you'll need to confirm whether the developer was registered for GST at the time of your purchase.
To use the margin scheme when you sell one half of the duplex, you must:
- ensure the sale is a taxable supply
- have a written agreement with the purchaser before settlement stating that the margin scheme applies
- calculate GST as 1/11th of the margin (the difference between what you originally paid for the land and the sale price of that half).
Under the margin scheme, the purchaser will need to withhold 7% of the contract price at settlement and pay it directly to us. You'll then report the sale on your activity statement, showing the margin at G1 and the GST on that margin at 1A. The construction costs for building the duplex don't form part of the margin calculation, but you can claim GST credits for those construction costs separately.
You can check whether the developer was registered for GST by searching their ABN on ABN Lookup if you have their ABN details. If you can't confirm the GST treatment of your original purchase, you may want to use our GST property decision tool or contact us for guidance specific to your situation before proceeding with the sale.
Thank you @JayATO for your answer. I understand now when and when you can use the margin scheme.
My predicament is I don't know if the developer used the margin scheme when he sold me the land (as I mentioned above).
I am still trying to find out if the developer used the margin scheme. I have checked online for historical information and can see he was registered for GST at the time. But I don't know if he used the margin scheme to sell to me due to lack of records.
Does the ATO keep records of land sale transactions that may assist me in finding out if he did include GST or use the margin scheme?
I just don't know where else to look for information to help me know if I can use the margin scheme.
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