Who pays GST on property transactions?
GST is a tax on the supply of goods and services. In property transactions, it is the seller of real estate that may be obliged to remit GST. Often a Contract passes the GST payment obligation to the purchaser. However not all supplies attract GST. A number of criteria must be satisfied before GST becomes payable. Some transactions may also be GST free. Transactions involving GST issues should be negotiated with care to ensure there is clarity on whether GST is applicable and who is obliged to pay the GST. The question of whether you are responsible for GST should be resolved prior to any Contract of Sale be entered into.
