April 1 marks a significant change in the GST tax treatment of mixed-use assets.
Taxpayers can claim 100% of GST for expenses relating to the income-earning use of a mixed-use asset, for example, the cost of advertising a holiday home online.
However, working out GST claims for expenses relating to both the income-earning and private use of the asset has been more difficult to establish.
In the past, a complex calculation has been needed to apportion GST expense claims relating to both income-earning and private use.
As of this month, GST calculations for mixed-use assets have been simplified. You no longer need to use the old method and general apportionment and adjustment rules will apply instead.
Remember, if you have a mixed-use asset, such as a boat, bach, or plane, please keep records on how and when it is used for business or private purposes.
If you’re unsure about these changes, give your adviser a call.
Disclaimer: This blog has been carefully prepared, but it has been written in general terms only. The blog should not be relied upon to provide specific information without also obtaining appropriate professional advice after detailed examination of your particular situation.
