Boarding house GST

Shawn asks:
(updated on Wednesday, December 13th 2017)

I'm looking to start a boarding houses business. What I plan to do is to rent large properties from landlords and sublet them (with permission from the landlords) on a room by room basis. Will I be liable for GST on the rent received from this type of business? 

Our Experts Answer:

Typically, yes. Whilst the supply of accommodation in a dwelling is GST exempt there is a distinction with a commercial dwelling like a boarding house, motel, hotel or hospital. Supply of accommodation in a commercial dwelling is a taxable activity for GST and registration is compulsory if supplies exceed $60000 pa.

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