ABSTRACT
This chapter provides a summary of Australian taxation regime as it impacts on holding and management of real property assets, particularly those held for income-producing purposes. As for any commercial undertaking, taxation implications for the development, ownership and management of real property must be understood and managed. Property taxes represent one of the oldest forms of revenue collection by governments, with a history dating back several thousands of years. An important Goods and Services Tax (GST) option for the property and, particularly, the development sector is what is known as a ‘Margin Scheme’ allowable under GST legislation. Where real property is sold under the margin scheme, instead of the vendor paying GST on full sale price and claiming tax credits for input costs, the developer only has to pay GST on the ‘margin’. Many of changes effect real property investment and use – matters of concern where such long-term assets rely on high levels of certainty as regards taxation liability.
