Calculate GST Withholding at Settlement
Estimate the amount that may need to be withheld from a property transaction and paid directly to the ATO.
Know What Needs to Be Set Aside at Settlement
Certain new residential property transactions require part of the purchase price to be directed to the ATO.
- Estimate withholding using the applicable property transaction method.
- Understand how the amount can affect settlement funds distribution.
- Prepare for relevant ATO payment and notification requirements.
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Property GST Withholding FAQs
GST withholding has specific purchaser and supplier requirements. Here are the practical points to know before settlement day.
When does GST withholding apply to property?
GST withholding rules generally apply when a purchaser acquires certain taxable supplies of new residential premises or potential residential land. The purchaser usually pays the withheld amount directly to the ATO at settlement.
How much GST does the purchaser withhold?
The amount is generally 1/11 of the contract price for fully taxable supplies or 7% of the contract price where the margin scheme applies. Different rules can apply to certain transactions between associates.
Does the purchaser pay GST on top of the purchase price?
Generally, no. The withholding amount forms part of the agreed consideration. At settlement, the purchaser pays the required amount to the ATO and the remaining settlement proceeds to the supplier.
How do I know whether withholding applies?
The supplier has notification obligations and should provide relevant information stating whether the purchaser is required to withhold and, where applicable, the amount required.
Does GST withholding apply to every residential property purchase?
No. It does not automatically apply to every home or residential property transaction. It is particularly relevant to certain taxable supplies of new residential premises and potential residential land.
Is this calculator a substitute for the supplier's notice?
No. The calculator is an estimate only. The contract, supplier notification and transaction’s actual GST treatment should be checked before settlement funds are distributed.
Managing GST Withholding at Settlement?
Our team can help review your property transaction and coordinate relevant settlement amounts, documents and conveyancing requirements carefully.