A property developer sells a new apartment for $800,000 including GST. The purchaser is claiming the First Home Owner Grant. What is the GST-exclusive price the developer receives?
Correct Answer
B) $727,273
When a price includes GST, the GST-exclusive amount is calculated by dividing by 1.1 (or multiplying by 10/11). $800,000 ÷ 1.1 = $727,273. The GST component of $72,727 must be remitted to the ATO by the developer.
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A property developer sells a new apartment for $750,000 including GST. The purchaser is an owner-occupier who is not registered for GST. How is the GST component handled in this transaction?
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A property developer sells a new residential unit for $550,000 including GST. The land cost was $200,000 and construction costs were $250,000 (both excluding GST). What GST must the developer remit to the ATO?