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The ATO has issued a Decision Impact Statement in relation to the decision of the Federal Court in ECC Southbank Pty Ltd as trustee for Nest Southbank Unit Trust & Anor v FCT [2012] FCA 795; 2012 ATC 20-336.

The case concerned whether premises designed and operated to provide student accommodation are commercial residential premises for GST purposes.

Section 195-1 of the GST Act relevantly defines commercial residential premises as meaning:

(a) a hotel, motel, inn, hostel or boarding house; or...
(f) anything similar to residential premises described in paragraph (a).

The Court held that the premises met the ordinary meaning of the term "hostel", or were similar to a hostel, and therefore commercial residential premises. The Decision Impact Statement states that "on the facts of this matter, it was open to the Court to [so] conclude".

It goes on to state that "(t)he decision does not support the preliminary view expressed in GSTR 2012/D1 that it is necessary for occupants to have the status of a guest in order for the premises to satisfy paragraphs (a) or (f) of the definition of commercial residential premises".

The Commissioner will therefore review the preliminary views set out in GSTR 2012/D1, which will replace GSTR 2000/20 when finalised, to ensure that the views expressed are consistent with the Court's decision.


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