PEXA streamlines GST payments on new property purchases
By PEXA - 11 August 2018
PEXA adapts its digital conveyancing system to streamline GST payments, enhancing transparency.
Melbourne, 09 August 2018 – Property Exchange Australia (PEXA) has expanded the capabilities of its e-Conveyancing platform to provide greater transparency for its members in response to recent legislative changes to the payment of Goods and Services Tax (GST) at settlement.
The changes – effective 1 July 2018 – now require property purchasers to pay GST on the price of new residential premises or potential residential land, directly to the Australian Taxation Office (ATO). Previously, developers were responsible for this payment.
As a result, PEXA has adapted its digital conveyancing system to streamline the management of GST payments for its members, and provide greater transparency and certainty for all parties involved in property settlements.
The introduction of this new legislation is primarily designed to reduce the $1.8 billion1 owing in GST payments to the Federal Government, and to eliminate the practice of ‘phoenixing’, a process by which a company declares insolvency, but reforms under a new name to avoid paying debts and taxes.
PEXA Group Executive, Customer & Revenue, Mike Cameron, said the visibility for all parties is a major benefit of a more streamlined, digital process. “The PEXA platform provides transparency for all parties and added assurance that the new process has been adhered to. The ability to complete GST at settlement through an e-Conveyancing transaction provides certainty for all involved in property exchange.”
Australian Institute of Conveyancers (AIC) National President, Shane Jacob, said, “We continue to help our members adapt to this change with information and training programmes. Through PEXA, we have the clarity we don’t get in the paper-based world that the GST for relevant properties had been captured. I see this as a best practice for the industry that is both fast and efficient.”
The AIC runs educational programs that highlight practitioner obligations. Future workshops covering GST withholding and more can be found here.