Claiming GST On Second Hand Goods

31 January 2018

If you purchase secondhand goods for use in your business from someone not associated to you (eg not a family member or relative) – these can be claimed for GST purposes. Examples are things such as vehicles and trading stock.

However there is a restriction on secondhand goods claims if your purchase goods from an unregistered associated person. No GST input tax may be claimed if the associated person did not pay GST when buying the goods, for example, if the associated person bought the goods before 1 October 1986 or from another unregistered person. This means an entity (eg company, partnership, soletrader, trust) can’t claim GST on assets introduced by the shareholders/owners unless they paid GST when buying the asset.

If in doubt please contact us and we can advise further about this.