GST and Property: Complexities and Challenges in Practice - recorded half-day online conference

You can put your staff in the boardroom and watch it there. You can watch it on your computer or on your portable electronic device. All for the same low price.

The conference will be based on our highly successful video webinar technology: there’ll be a chairperson, a panel of experts, presentations and discussion.

Session 1: Traps and Hazards in the GST Withholding Regime

Now that the GST withholding regime has been in for over a year, the common errors that are being made have become more apparent. This session identifies common traps and hazards occurring in relation to GST withholding on new residential premises and potential residential land, including:

• Not notifying right suppliers

• Not capturing the right land

• Not understanding how the margin scheme interacts

• Managing multiple vendors

• Managing multiple supplies for undivided price:

  • what amount is referable to which supply

  • understanding how the withholding forms work

• Special issues with development leases:

  • what happens when purchaser withholds GST and the landowner and developer split the proceeds 50/50 even though GST paid goes only to the owner?

  • issues with the transitional provisions

Session 2: Margin Scheme Howlers: Avoiding them Before They Happen

The margin scheme is a favourite of residential property developers. It always sounds good in theory, but in practice attempts to use it often fail for want of attention to the detail. This presentation covers all the usual issues when using the margin scheme with a focus on the practical things your clients need to cover off on in order to ensure that their choice is effective and the GST results are not a disaster. Given the freewheeling and swashbuckling nature of many property developers, this is easier said than done! This session covers:

• The margin scheme: a quick refresher on how it works

• Practical problems: on which margin is the GST calculated:

  • prior GST-free sales – look through provisions

  • no sale prior to the start of GST

• Practical problems: 30 June 2000 valuations – complying with the Commissioner’s guidelines – what can go wrong – case law

• Conditional application of the margin scheme – conditioned on what – can you do it?

• Practical problems: consolidation of sites for redevelopment – how you manage different margin scheme status of different parcels

• Practical problems: application of withholding tax to margin scheme transactions

• Practical problems: how do you ensure that the margin scheme applies?What preconditions must be met?

Session 3: GST Adjustments and Change of Purpose

Though Division 129 of the GST Act is highly significant for property developers and investors, the provisions can appear dry at first glance. This practical session takes an in-depth look at the GST consequences of a change of purpose using two case studies:

1. Case study 1: Block of land in retail strip purchased for knock down of shop and construction of 3 storey building – ground floor was to be business run by the owner, 1^st floor was residential lease investment and 2^nd floor was to be main residence. Foreclosure led to sale of the property.

2. Case study 2: Subdivide and develop property intending to sell, but then lease both lots, one temporarily before sale and the other as an ongoing property investment

Issues considered in this session include:

• Identifying adjustment periods

• Time of the change of purpose

• Maintaining documentation and evidence to support change of purpose

• Calculation of adjustments and reasonable methods of apportionment

• When does the clock start ticking: the 4-year time limit on GST refunds?