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Understanding GST: When is a Subdivision Project Considered a Taxable Activity?

  • Subdivision projects can be considered taxable activities for GST purposes
  • A subdivision project is considered taxable when it is carried on continuously or regularly and involves making supplies to another person for consideration
  • The determination of whether a subdivision project is continuous or regular is based on the number of lots created and sold, as well as the level of activity involved
  • The scale of the subdivision and level of development work also play a role in determining if a subdivision project is a taxable activity
  • Each case must be considered individually to determine if a subdivision project is a taxable activity
  • Key terms include defining subdivision as dividing land into two or more parts or changing existing boundaries
  • The policy statement “GST and subdivisions
  • Court of Appeal decision in the Newman case” outlines the Commissioner of Inland Revenue’s position on this matter.

Source: taxtechnical.ird.govt.nz

Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.

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