GST registration on short term rentals?

Question from Kay updated on 22nd August 2013:

Hi, we have three individual residential rental properties, two we run as short term rentals. Our gross income is approximately $100,000 (about $80,000 from the short term rentals). Do we have to be GST registered?

Our expert Mark Withers responded:

Dear Kay, I assume you are generating the short term income by letting on a license to occupy in a holiday home type situation. The provision of permanent accommodation is exempt from GST as it constitutes the supply of accommodation in a dwelling, this is not the case though where the provision of accommodation is more commercial in nature. Under these circumstances registration is required if the turnover is in excess of $60,000 per annum. As that is the case for you then you will need to register the activity. You should consult an accountant on the implications for the properties themselves that are being introduced to the taxable activity.

Mark Withers and his team at Withers Tsang & Co specialise in advising on property related transactions, valuation and restructure services and tax planning.

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