Proposed changes to tax laws in the Budget could cost the rest-home industry millions of dollars and raise costs for rest-home occupants, a report by Deloitte partner Thomas Pippos says.
Tuesday, June 7th 2005, 8:30AM
by The Landlord
Under planned amendments to the Goods and Services Tax Act, refundable deposits made by people wishing to secure a place in a rest home, which till now were not taxed, may be subject to GST, Mr Pippos said.
Such deposits are made when a person cannot buy a room or an apartment in a rest home because the property's legal title cannot be separated. Instead, the tenant may pay a refundable deposit and pay a form of rent on top of that.
The amendment to the tax bill signified that the Government considered this deposit to be taxable, because it saw it as being, effectively, a part of that rent money, Mr Pippos said.
