In a private ruling, the ATO has confirmed that GST must be paid on any amounts recovered from commercial tenants. This is because any amounts collected from tenants under a commercial tenancy are regarded as income subject to GST. The owner must pay GST on the whole amount. If you include GST in the invoice, everything works out nicely - you pay the GST to the ATO and the tenant claims a credit. If you don’t, you're liable and the tenant can demand a tax invoice and claim the GST! Their costs just went down by 10%. Call Tim, our commercial management specialist, on 9747 4400 for further details.