Show download pdf controls
  • 1.2.1 What is the GST treatment of body corporate levies with respect to administration and sinking funds over the transition period?

    For source of ATO view, refer to:

    • paragraphs 25 to 30 of GSTR 2000/7 Goods and services tax: transitional arrangements - supplies, including supplies of rights, made before 1 July 2000 and the extent to which such supplies are taken to be made on or after 1 July 2000
    • the general principles in GSTD 2000/3 Goods and services tax: transitional arrangements: to what extent is the supply of services made on or after 1 July 2000, where the supply spans that date?

    ATO position

    Under section 7 of the Transition Act, GST is payable on a supply to the extent that it is made on or after 1 July 2000. Section 6 of the Transition Act sets out the general time of supply rule for determining when a supply or acquisition is made for the purposes of that Act. Specifically, section 6(4) provides that a supply or acquisition of services is made when the services are performed.

    However, this general rule is modified when the supply is made over a specified period. Under section 12 of the Transition Act, where a supply, under an agreement or enactment, is made for a period or progressively over a period that begins before 1 July 2000 and ends on or after 1 July 2000, the supply is taken to be made continuously and uniformly throughout that period. This is whether the supply is made at regular intervals or not.

    The payment of a body corporate levy is consideration for the supply or acquisition of that service.

    Where there is a supply for a period that starts before 1 July 2000 and ends on or after 1 July 2000, the supply is considered to have been made continuously and uniformly over that period. As body corporate levies in respect of administration and sinking funds are regarded as being consideration for the supply of services for a period, it will be necessary to apportion the supply over the period covered by the levy.

    For example:

    A levy is paid for the three month period 1 May 2000 - 31 July 2000. GST will be payable only on that portion of the levy which relates to the supply made for the period 1 - 31 July 2000.
      Last modified: 05 Aug 2016QC 16473