Generally, the grant of a lease to residents of retirement villages, which are privately funded, is an input taxed supply and operators cannot claim an ITC in respect of the accommodation. In addition to this, operators may also supply services such as bedding and cleaning services to these residents. The ATO’s view is if these services could reasonably be expected to be provided concurrently with the supply of accommodation, then these services will also be input taxed.
Source: Mondaq
