As of 1 July 2018, new GST withholding rules apply in relation to the supply of new residential premises. These new rules require purchasers to remit GST on the purchase of new residential property directly to the Australian Taxation Office (ATO). Revenue Ruling No. DUT 047 (‘DUT 047’) clarifies that where the purchase of new residential property occurs, duty payable will be the total amount of consideration, including the GST portion of the purchase price.

Duty Payable

DUT 047 cites three cases that support the position taken in the Revenue Ruling. The first is Ambience (Arncliffe) Pty Ltd v Chief Commissioner of State Revenue[1]. In this case it was held that the GST portion of the purchase price was part of the consideration to be paid, and therefore duty was payable on this component of the purchase price.

In the Victorian case of Commissioner of State Revenue v Royal and Sun Alliance Insurance Australia Ltd[2], it was held that it made no difference to the value of the duty payable, whether the price for the sale of the property was inclusive or exclusive of GST. The payable duty relates to the consideration of the transaction. The GST is part of the consideration. This position has been reaffirmed in the NSW case Gould Management Pty Ltd v Chief Commissioner of State Revenue[3].

Revenue Ruling No. DUT 047 does not in essence say anything new. Rather, DUT 047 clarifies and makes clear that a separate designation of the GST component relating to the sale does not make any difference to the amount of duty payable on a stamped document. Put simply, new Commonwealth GST withholding rules have no effect on the value of dutiable property, and duty payable.

[1] [2002] NSWADT 206.

[2] [2003] VSCA 117.

[3] [2004] NSWADT 66.