You can't use the margin scheme to sell a property if all of the following apply:

• You purchased the property from an associate who was registered or required to be registered for GST at the time of your purchase.
• The purchase of the property from your associate was without payment.
• The sale of the property to you by your associate was not a taxable sale.
• Your associate made the sale of the property to you in the course or furtherance of a business that your associate carried on.
• Your associate had purchased the entire property through a fully taxable sale and GST was worked out without using the margin scheme.