Author Box
Articles Categories
All Categories
Articles Resources

The Need to Get an ABN Number When Purchasing a Property From a Business

March 03, 2011 | Comments: 0 | Views: 59

In some situations it is very important to obtain a tax invoice in relation to the sale of property. For example, someone might be purchasing a commercial building for $1 million subject to existing tenancies. The contract states that the sale is not taxable supply because the vendor is neither registered not required to register the GST. The purchaser is in the same situation as a vandal and they are not registered for GST either and does not need to be, even after they have bought the building. The rental value of the building is less than the GST threshold of $75,000. If you're in this situation, what would normally happen is that your accountant would explain that you could be registering when you buy the building, because you be carrying on the enterprise of leasing, but that you consider you will be better off not registering because the cost of paying GST on the rent would be greater than the benefit of input tax credits on the acquisition of the building.

Sometime later, you might get a call from the tax office about a random audit. One of the requirements of the tax office has is that details of an acquisition of a commercial building. It would then be necessary to the tax office to view what ABN was provided in relation to the transaction. At this point you would be confused because there would be no need from invoice is a sale was not subject to GST. However, your accountant might say, and rightfully point out that you need to get the ABN because the withholding tax issue despite the fact that it has nothing to do with GST.

In Australia, taxation administration legislation under section 12 190 provides in brief that when payment is made for real estate or goods or services supplied in the course or furtherance of enterprise carried on in Australia by the supplier, recipient of the supply must withhold an amount unless the supplier quotes the ABN or tax file number. this is obviously not desirable if you're in a situation because you might be forced to pay the withholding tax on the purchase price which could be disastrous imposition on you. Thankfully, you should also be able to look at the abbey and using an ABN, but it takes a quick thinking; you need to do this under pressure. Paying attention to these basic details reaps reward of not coming across these seemingly trivial problems later on when it become a very large problem.

David Coleman is a tax lawyer based in Sydney, Australia. If you Would like legal advice please do not hesitate to click on the links provided here.

Source: EzineArticles
Was this Helpful ?

Rate this Article

Article Tags:

Abn Number


Tax Lawyer


Legal Advice


Tax Office


Tax Invoice

The 3 Month Payday Loans is most suitable options for the people who do not possess assets. There are a variety of loan options for the people who are willing to pledge assets against the cash

By: Cameron white l Finance > Personal Finance l July 09, 2013 lViews: 561

For many people, bankruptcy can make their world fall apart. The apparent loss of reputation coupled with the inability to take financial decisions can deter anyone from thinking clearly. But all is

By: noragwilt l Finance > Bankruptcy Lawyers l November 18, 2012 lViews: 304

If you are availing payday loans with monthly payments, it is easy for you to obtain quick money from online lending companies.By getting the best deals of loan, you can save money in terms of

By: Malen Cheks l Finance > Loans l November 16, 2012 lViews: 289

Loans online have become the popular source of income and people can make smart decision of taking it.Now, don’t go anywhere and sit in your home silently. Such deals would bring you money without

By: Marsh Jone l Finance > Loans l November 13, 2012 lViews: 288

Loans for the unemployed would let you feel comfortable with your unstable conditions due to jobless period.If you compare the rates of a few lenders, you would definitely get the suitable lender to

By: kelse roy l Finance > Loans l November 13, 2012 lViews: 467

By taking cash advance for bad credit, it is easy for you to improve your credit status. This loan is useful to relieve financial stress. This loan is totally free from credit verification and

By: Honard Nork l Finance > Loans l November 09, 2012 lViews: 301

Tax liens are like government restrictions on certain properties. These so called restrictions are usually imposed on specific lands and properties that are usually delinquent in the loan or mortgage

By: Andrea Averyl Finance > Taxes Propertyl June 21, 2012 lViews: 144

When you can no longer maintain your monthly mortgage payments and real estate taxes, you risk losing your real estate to the government through foreclosure. Once your real estate taxes have entered

By: Antoinette Ayanal Finance > Taxes Propertyl June 20, 2012 lViews: 162

Homebuyers need resources in today's marketplace if they hope to find the best deals on properties. Articles like the one you're reading now, are all about pointing you in the right direction and

By: Kevin P McGeel Finance > Taxes Propertyl June 10, 2012 lViews: 151

What should you consider in relation to the property taxes you will have to pay when investing in investment property? This article discusses what taxes you pay and how different structures can

By: Julian Thorntonl Finance > Taxes Propertyl June 01, 2012 lViews: 176

There are a number of property tax reduction programs available to property owners. Although many of the tax reduction programs are similar, each has it's own set of rules for the tax appeal process.

By: Gerald Fishl Finance > Taxes Propertyl May 14, 2012 lViews: 139

Fair to say, if you are living anywhere in the country, you are probably paying more property taxes than you should. The National Taxpayers Union, in fact, estimates that approximately 60% of all US

By: Peter A Jordanl Finance > Taxes Propertyl April 16, 2012 lViews: 133

Discuss this Article

comments powered by Disqus