QUOTE (Cargren @ Mar 2 2010, 01:31 PM) Hello Jacquie,
Are you saying you didn`t have to pay GST at all on your purchases of commercial properties? Some time back I purchased land for building a spec home. I have a GST # and remember that I filled out a form so that I didn`t have to pay GST. This saved me from either coming up with extra cash or financing the GST.
I`m looking to buy a new commercial property for leasing out for a retailer, and am wondering if this would apply here as the GST would be around $50,000 and would take forever to recuperate through credit on the monthly GST charged to lessee.
Thanks for any help you are able to provide.
rob
Now that I think of it, I believe this is the way it works,
I pay GST when I purchase the property. Normally I would fork over the full amount of the GST, and then claim an input tax credit for that amount and get reimbursed. However, this is a process that can take several months, so for cash flow reasons the government provides a form that speeds up this process by completing the transaction in one step on the day of closing, thus saving the buyer having to temporarily fund the GST amount.
I now charge the tenant GST on the lease and pay that when I file monthly, quarterly, or annual GST reports.
Is this correct?