How do you calculate the GST on levies if the Body Corporate/Owners Corporation is under the $50 000 threshold?
ATO Position Registration is not mandatory where an entity’s annual turnover does not exceed $50 000. However, an entity may choose to be registered even if they do not meet the turnover threshold requirements. If an entity registers for the GST, they will be required to remit the GST on any taxable supplies that they make. The amount of GST which must be remitted is equal to 10% of the value of the supply (s. 9-70 A New Tax System (Goods and Services Tax) Act 1999 (‘the GST Act’)). The value of the supply is 10/11 of the price (s. 9-75 of the GST Act). If Body Corporate/Owners Corporation is below the turnover threshold but voluntarily register they are required to remit GST, they must remit 10% of the value of the supplies regardless of whether they reach the $50 000 threshold. The following is an example where the levy value is $100:- Levy Value $100 GST $ 10 —— Price $110 GST to be remitted to Australian Taxation Office is 1/11 of the price = $10.
Related Questions
- What are the Goods and Services Tax (GST) implications of an unregistered Body Corporate/Owners Corporation with no Australian Business Number (ABN) which deals with a supplier with no ABN?
- If an Body Corporate/Owners Corporation is registered, does it charge the GST on levies (administrative and sinking fund)?
- How do you calculate the GST on levies if the Body Corporate/Owners Corporation is under the $50 000 threshold?
