08 Jun 11
GST treatment of property in possession of a mortgagee
On 7 June 2011 the Treasury released a consultation paper, entitled “GST Treatment of Property in Possession of a Mortgagee”, on the design of a measure to amend the GST law prospectively to ensure it achieves the intended policy objective in relation to the taxation of supplies of property of particular types of incapacitated entities.
In the 2011-12 Budget the Government announced that it will amend the GST law to clarify that Division 105 of the GST Act operates to the exclusion of Division 58 of the GST Act where a mortgagee in possession or control sells the property of a corporation. The measure will clarify the operation of the law for representatives of incapacitated entities when complying with their GST obligations. The proposal is consistent with the ATO’s current GST treatment of a mortgagor’s property supplied by a mortgagee in possession or control.
The closing date for submissions is Wednesday, 6 July 2011.