Does GST apply

[scottw]

If you are purchasing a multi unit residential building greater then 6 units, is the purchaser required to pay GST??

Scott

 

[Dan_Eisenhauer]

If it is not a new building, I believe no GST is payable.

However, if there is a commercial component to the building, even a small one like a convenience store, GST is paid on that portion of the purchase.

 

[DragonflyProperties]

Hi Scott,

GST legislation (or any other) as it applies to real estate is/can be a very complex. The correct response will always be dependent on the individual`s specific circumstances. The result for one investor can be very different for another even though the circumstances might appear to be the same (and are not). My advice is to pay for proper professional advice (accountant or lawyer) upfront to ensure that you don`t run into a problem(s) down the road. I would not rely on general responses from members to your specific situation. I see too many members providing free "advice" in areas where they are, in all probability, not qualified to do so.

Keith

 

[Dan_Eisenhauer]

After giving it some thought, I agree with Keith. Tax issues can become very complicated, and you need expert advice on your specific situation.
Having said that, here is an excerpt from CRA`s website:

Sale of a previously occupied multiple unit residential complex or an addition thereto subsequent to a self-supply

Application
Sch V, Part I, s 5

38. Section 5 of Part I of Schedule V exempts the sale by a builder of a multiple unit residential complex or an addition thereto, where the builder last acquired the complex or addition by way of an exempt supply or a deemed sale under the self-supply rules found in subsections 191(3) or 191(4).

Conditions

39. This sale is exempt if:

• the builder has not claimed an ITC in respect of the last acquisition of the complex (or addition), or in respect of an improvement to the complex (or addition) since the last acquisition; orthe builder has not substantially renovated the complex (or addition), or engaged another person to substantially renovate the complex (or addition) after the last acquisition of the complex (or addition) by the builder.

Confused? Call your tax expert.

 

[Thomas Beyer]

QUOTE (scottw @ Oct 5 2008, 08:47 AM) If you are purchasing a multi unit residential building greater then 6 units, is the purchaser required to pay GST??

Scott
GST is not paid on residential properties, regardless of # of units, but on any commercial component such as a built in retail store or non-residential income opprtunity such as a billboard or cell phone tower on roof ..