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 GST on holiday home

This is a much debated issue, as it is a grey area. The definitions of residential dwelling and commercial dwelling do not give a clear answer to what kind of dwelling a holiday home should be. A holiday home is often rented out only for short stays which does not fall into the definition of “dwelling” as it is not a principle place of residence of the person renting the holiday home. Moreover if there are no additional services provided, it also does not fit in the definition of a commercial dwelling. Normally, the conservative view on the treatment of a holiday will be applied as a residential dwelling. Thus, no GST can be claimed on the sale or purchase of a holiday home. Moreover, rental income from the holiday home does not attract GST while expenses related to the derivation of rental income also do not include GST. However, it is not right for all cases, please seek professional advice if you want more information on GST treatment on holiday home. 

 

Disclaimer: The following answer necessarily sets out general principles only. The facts of particular cases always need to be considered carefully, and it may be necessary to obtain advice from a tax expert. 

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