GST changes clear up bach rules
Some family baches have been inadvertently caught in the GST net since April 1, 2011.
The institute said that of particular concern was a sole trader who also rented out their family bach for short-term accommodation.
Under current rules, they are required to return 3/23 of the sale price as GST to IRD. Those who carry on business through a company would not need to do so. Government’s proposed amendments will fix this.
“We raised concerns that the effects of the 2011 changes were unintended,” said the institute’s acting tax general manager, Jolayne Trim.
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