[DNS] gst on au domain name resales

[DNS] gst on au domain name resales

From: Chris Maltby <chris§sw.oz.au>
Date: Tue, 30 Sep 2008 22:49:56 +1000
On Tue, Sep 30, 2008 at 10:30:18PM +1000, Jason Parsons wrote:
> I understand these people/businesses that have registered heaps of domains
> they become like stock.
> But for your average Jo that gets offered or wants to sell or buy a domain
> name in aftermarket I'm unsure how GST applies. I'm no accountant I'd just
> like a explanation.
> What is something it can be compared to in a business assets/inventory that
> goes up in value from retail and has GST applied to it?
> Maybe paintings/comic books/trading cards/antiques I suppose.
> Are there any accountants reading this topic?
> Sorry for harping on.......

I'm no accountant, and the GST law is (as I understand) very complex and
full of special cases for distinguishing taxable supply of a good or
service from the non-taxable trading of assets such as land or shares.

It seems to me that domain registration fees are clearly taxable supply
and subject to GST. The cost of the registration fee or sign-on fee
would be irrelevant. If you paid the registrar $100K for a fancy name,
it would have GST payable by the registrar and you would receive a GST
input credit.

Domain transfers between registrants might be GST exempt if you could
assign a capital asset value to the domain name registration and
demonstrate title to that asset - but as domain registrations act more
like a conditional lease or grant of license than outright ownership, it
would seem to me that it would be difficult to avoid GST on transfer
fees too.

Received on Tue Sep 30 2008 - 05:49:56 UTC

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