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Topics on CGT and GST for property buyers (28)

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Step Three – Complete and lodge ‘Form Two’ 

A buyer is next required to notify the ATO of the confirmed settlement date, by using their LRN and PRN (obtained upon lodging Form One) to complete and lodge Form Two: GST property settlement date confirmation online. Lodgment is generally required within two business days before settlement, on the day of settlement or on the next business day after settlement, with modified lodgment deadlines applying to properties acquired under instalment contracts. 

Note that Form Two should not be lodged if the contract is not completed (i.e., where settlement does not occur). 

Step Four – Pay the withholding amount 

Finally, a buyer must pay the withholding amount to the ATO. Payment is due by the day of settlement (under a standard land contract) or by the day the first instalment is paid (under an instalment contract). Using information obtained upon lodging Form One (e.g., the buyer’s PRN), a direct payment may be made to the ATO through one of the following methods: 

  • e-conveyancing; 
  • electronic transfer, BPAY or a credit (or debit) card; 
  • in person at Australia post; or 
  • by mailing the buyer’s payment details, and a cheque or money order payable to the ATO. 

Alternatively, a buyer may pay the ATO indirectly through the seller (acting as their agent). To make an indirect payment, the buyer must provide the seller their GST withholding payment slip, PRN and a bank cheque nominating the ATO as payee, which the seller gives to the ATO. 

Proof of payment (e.g., a receipt from Australia Post or the bank, a copy of the bank statement, or a copy of the cheque and payment slip) should be retained. Where a buyer has provided an email address on Form Two, a payment confirmation will also be sent to them by email. 

Refer to ‘How to pay the withholding amount’ in the ATO’s factsheet ‘GST property settlement online forms and instructions’ (QC 55781) and the ATO’s factsheet ‘GST at settlement – a guide for purchasers and their representatives’ (QC 56253). 

 

 

  • Should you have any queries, please contact Tax Ideas Accountants & Advisers on +61 2 83181545 
  • Alternatively, you can book an appointment in our live calendar 

 

Written by Panbo Ye

I help people discover POWERFUL unknowns in Tax Ideas | Wealth Strategies | Retirement Planning | Finance Solutions!

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