The Australian Taxation Office (ATO) has recently issued a draft GST ruling after reconsidering its characterisation of moveable dwelling parks for the purposes of the A New Tax System (Goods and Services Tax) Act 1999 (Cth) (GST Act).

The Commissioner has recognised that moveable dwelling parks have changed significantly since the Commissioner’s original ruling in 2000. Moveable dwelling parks are now “…designed to provide long-term accommodation as may be found in a gated community or retirement village, without the provision of short-term accommodation”.

When the final ruling is issued it will have effect both before and after the date of its issue, but operators who have relied on GSTR 2000\20 will not be subject to the retrospective application.

It considers the GST implications of:

  • the supply of a moveable home site to a resident by way of a lease or licence;\
  • the supply of a moveable home before it is placed on land and installed ready for occupation;
  • the supply to a resident by way of lease or licence of both a moveable home site and a moveable home; and
  • separate supplies of moveable home site (by way of lease or licence) and moveable home (by way of sale).

Supply of a moveable home site to a resident by way of a lease or licence

The Commissioner takes the view that the supply by way of lease or licence of a moveable home site is a taxable supply because:

  • the site is vacant land;
  • vacant land is not “premises” for the purpose of the GST Act;
  • the vacant land is not capable of being occupied as residential accommodation.

The lease or licence cannot be input taxed as it is not the supply of residential premises used predominantly for residential accommodation.

The fact that a moveable home is subsequently placed on the site does not impact on the supply being a taxable supply.

Supply of a moveable home before it is placed on land and installed ready for occupation

The supply of a moveable home to a resident before it is placed on the moveable home site is a taxable supply. However, if the moveable home has been used by the operator in connection with making input taxed supplies of residential premises, then the sale of the movable home will be an input taxed supply.

The supply of the home before it is ready for occupation is not the supply of real property nor the supply of residential premises used predominantly for residential accommodation.

Supply by way of lease or licence of both a moveable home site and a moveable home

The GST position for this type of supply differs to supplying these elements separately. The reasoning for this is that a moveable home that has already been placed on the moveable home site is suitable and capable of being occupied predominantly for residential accommodation.

Therefore, the supply of these 2 things together is an input taxed supply. It is important to keep in mind that, the moveable home must be in place in order to satisfy the requirements for the supply to be input taxed.

Separate supplies of a moveable home site (by way of lease or licence) and a moveable home (by way of sale)

Each of these supplies must be characterised separately.

The supply of the moveable home site by way of lease or licence is a taxable supply.

The supply of a moveable home by way of sale that has been placed on the site is a taxable supply and not input taxed. This is because the moveable home is not a fixture, it does not fall within the scope of residential premises that are real property.

The outcome for this is not changed even where the moveable home has been previously sold and placed on the same moveable home site.

The supply of the moveable home may be input taxed if the operator has used the moveable home in connection with making input taxed supplies of residential premises by way of lease, hire or licence.

Next steps

You should keep in mind that the ruling, when finalised, will have effect both before and after the date that it is issued.

You can continue to rely on the position set out in GSTR 2000/20 until such time as the draft ruling is finalised.

We recommend considering the current GST treatment that you applying to these types of supplies to ensure that the correct treatment is being applied.