Buying a renovated home? You could be up for an extra 10 per cent GST, but it’s a gray area
A home buyer usually does not pay goods and services tax (GST) on a home except if they buy a new home that has not been sold before as residential property. However, when a home that has been “substantially renovated” is sold, the buyer may have to pay GST. This can add 10 per cent to the price of the home for the buyer.
The problem home buyers face is that what qualifies as a “substantial renovation” is uncertain. The Australian Taxation Office does provide some guidance on this in a ruling. However, the definition is subject to interpretation.
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