The AAT has held that a transaction in relation to the sale of a commercial property met the requirements of a going concern under s 38-325 of the GST Act. Accordingly, it set aside the Commissioner’s decision and held there was no tax shortfall.
The taxpayer was the owner of a commercial property and in 2009 entered into a contract to sell the property. Settlement subsequently occurred in December 2010. In 2011, the Commissioner conducted an audit of the taxpayer and issued a notice of assessment for a GST shortfall of $206,818 in relation to the sale of the property. He contended that the supply was not a going concern as the contract was silent on the issue and therefore there was no agreement in writing as required by s 38-325(1)(c). The taxpayer argued that the written agreement does not need to be contained in the contract and pointed to evidence from various other documents such as a tax invoice for the sale and the Goods Statutory Declaration.
The Tribunal agreed with the taxpayer and held that the requirement for the agreement to be in writing under s 38-325(1)(c) had been satisfied through a combination of contract of sale, the tax invoice, and the Goods Statutory declaration. Therefore, the AAT set aside the Commissioner’s decision of a GST shortfall of $206,818 and held that the transaction between the taxpayer and the purchaser of the property incorporated an agreement in writing that the supply involved a going concern under s 38-325 of the GST Act.
(AAT Case [2012] AATA 763, Re SDI Group Pty Ltd and FCT, AAT, Ref No 2012/0733, Hughes M, 2 November 2012.)
[LTN 214, 5/11]