On 1 August 2018, the NSW Chief Commissioner of State Revenue, Stephen Brady (Commissioner), released Revenue Ruling No. DUT 047 (Ruling). The Ruling clarifies the Commissioner’s view with respect to the calculation of the dutiable value of where the property in question is a taxable supply of new residential premises or residential land that is subject to the new GST Withholding regime.
By way of background, it is generally accepted as settled law that the GST component of the purchase price for the sale of land that is a taxable supply forms part of the dutiable value of the property and that, therefore, duty is payable on the GST-inclusive price.
In certain circumstances, the new GST Withholding regime requires the purchaser to withhold the GST component of the purchase price and remit this amount directly to the ATO (or to the vendor via a bank cheque made out to the Commissioner of Taxation). The regime was introduced as an integrity measure to facilitate collection of GST revenue.
This Ruling states that the amount of GST withheld under the new regime will form part of the dutiable value of the property, and so will be subject to stamp duty in the same way as if the GST was collected by the vendor.