Legal Question in Legal Ethics in New Zealand (Aotearoa)
GST Payment
We have a GST payment to do on a development property that sold in May. Our financiers now refuse to pay the GST out of the sale proceedings. We can't pay it ourselves and will accumulate penalties and intrest. We also sold another property which was not commercial and didn't incur any GST payment, so we could meet our obligations , but our financiers don't want to pay the GST owned on the other property out of these proceedings neither. We have still another 3 properties on the market, they haven't sold yet, but the total valuation outweighs our borrowings. We are now seriously considering filing for receivership, because it seems that we're only incurring additional costs, because of penalties etc. Our lawyers are also shareholders of the financial company whith whom we have our borrowings, and they assure us that they want to avoid receivership. So do we, but then why doesn't the financier pay GST on a GST registered sale? Our accountant also contacted them and they confirmed they will not pay the GST. What to do next and do we have the right to demand for GST payment out of the proceedings of these sales.?
1 Answer from Attorneys
Re: GST Payment
It appears that your lawyers face a conflict of interest so that they may not be advising you properly.
They should be able to give you the reason why the financier is refusing to pay the GST out. If they cannot or will not you must instruct other solicitors immediately and get them to demand that your present lawyers hand over their file so that proper advice can be given.
On the information given so far it is impossible to advise you any further.
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