When you sell or lease non-residential property, GST is applicable if you are GST-registered.
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Personal vs. Partnership Property

As a partner of a GST-registered partnership, you are required to assess if the property is your personal property or your partnership property.

If the property is your personal property, you do not need to charge GST on the sale or lease of the non-residential property.

If the property is your partnership property, you have to charge GST on the sale or lease of the non-residential property.

Factors to Determine Partnership Property

  1. Whether there is an agreement or mutual understanding among partners in relation to that property.
  2. Whether the property is bought with funds of the partnership business. If so, it is likely to be a partnership property.
  3. Whether the property is reflected as an asset (e.g. in balance sheet statement) of the partnership business. If so, it is likely to be a partnership property.
  4. Whether the property is used in the course or furtherance of the partnership business. If so, it is likely to be a partnership property.
  5. Whether rental proceeds from rental of the property (if any) are distributed among the partners. If so, it is likely to be a partnership property.
  6. Whether all the property owners are partners of the partnership. If so, it is likely to be a partnership property. For example, if one of the property owners is not a partner of the partnership, then the property is less likely to be a partnership property.

FAQs

If the property’s owners’ name reflects the partners’ names, can this prove that the property is our personal investment?

No. Please use the list of factors to assess if this property is a personal property or a partnership property.

If a property is a partnership’s property, can the input tax incurred in its purchase be claimed by the partnership?

Whether the input tax incurred is claimable is subjected to the same conditions as all other input tax claim. Please refer to conditions for claiming input tax.

I am not GST-registered but I am going to sell a shop house under my personal name. This is the only commercial property that I own and I have no other sales turnover. Do I need to register for GST & account for GST on the sale?

If you are an individual and have acquired a non-residential property under your personal name for the purpose of a personal investment, you do not have to register for GST if this is a one-off sale. The property must not have been used for the purpose of your business, and the disposal is not made with the intention to trade. As you are not registered for GST, you cannot charge GST on your sales.

If you are in a business (e.g. sole-proprietorship business), please refer to Do I need to register for GST to determine your liability for GST registration. If the property is your capital asset, you do not need to take the sale into account when determining your turnover.

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