Property tangled in GST web

You may be forgiven for thinking that there is little to say about the GST that hasn’t already been written, but although much has been said it’s only the tip of the iceberg.

Property is enmeshed in the GST web and investors and owners must take great caution when reviewing their investment strategies.

There has been little effect on property prices and yields thus far. However, there is no doubt that net returns will be affected but the after tax position may be less of an issue with proper advice and planning.

Owners of property assets must scrutinise lease terms closely to ensure their ability to recover GST on rentals paid by tenants.

All new leases (and Offers for Lease), must also make provision for the potential implications of this new tax.

How to absorb the GST impact on operating expenses and how to deal most effectively with the tax credits will also be significant challenges.

Property owners and investors are urged to seek appropriate legal and accounting advice to best protect their respective positions well in advance of the tax implementation date of 1 July 2000.

In conjunction with KPMG, the Property Council of Australia has produced a publication titled GST – A Guide For The Property Industry which aims to answer many of the questions that arise as a result of the GST implementation.

The publication, ‘a must for property industry participants’, will be launched at the Property Council/ KPMG Business Tax Forum on Tuesday 17 August.

For details contact Tanya at the Property Council office on 9321 1156.

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