- ATO issued GST reminder for retirement villages
- Purchasers of operating retirement villages should expect increasing GST adjustments
- Increasing adjustment occurs if village is in operation and making a profit
- Input-taxed supplies through the village lead to increasing adjustment
- Adjustment is 10% of sale price multiplied by proportion of non-creditable use
- Input tax supplies by purchaser are considered non-creditable use
- Additional adjustments may be needed if proportion of non-creditable use changes
- Example of Wren acquiring a retirement village with input taxed supplies
- Wren subject to increasing adjustment due to non-creditable use
- Additional GST payable by Wren calculated as $1.158 million
Source: accountingtimes.com.au
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.
