• GST and international transport of passengers

    If you sell international passenger transport and associated insurance, in most cases, the sale is GST-free. However, there are some circumstances when they are not GST-free or are only GST-free if the transport is used outside Australia.

    Find out more

    GST definitions: sales

    End of find out more

    When can you sell international passenger transport GST-free?

    You can sell international transport GST-free if you sell it to passengers travelling to or from Australia (by air or sea) and it is from any of the following:

    • the last place of departure in Australia to a destination outside Australia
    • a place outside Australia to the first place of arrival in Australia
    • a place outside Australia to the same or another place outside Australia.

    When can you sell the domestic legs of international passenger transport GST-free?

    Domestic transport by air

    You can sell domestic air transport GST-free if the following applies – the domestic transport:

    • is part of an itinerary or arrangement leading to international air transport
    • formed part of a ticket for international air transport when the arrangement was made, or was cross-referenced to it.

    Example

    Tanya lives in Brisbane and has booked an overseas trip. She will fly from Brisbane to Sydney to connect with a flight to New York. From New York she will fly to London and then back to Australia, landing in Sydney before flying home to Brisbane. All of Tanya's airfares are GST-free if the Brisbane to Sydney and Sydney to Brisbane flights were booked or committed to at the same time as the international flights.

    If the Brisbane to Sydney return flights were booked separately but cross-referenced to the international flights, they are also GST-free.

    End of example

    Domestic transport by sea

    Domestic sea transport you sell is wholly GST-free if you also sell the transport to or from Australia and it is part of a journey from either of the following:

    • Australia to a destination outside Australia
    • a destination outside Australia to Australia.

    If domestic sea transport you sell is not wholly GST-free it may still be GST-free if the transport is used outside Australia.

     

    Example

    Tom and Jane, from Hobart, recently married and will celebrate with an ocean cruise to Fiji that departs from Melbourne. Jill organises a separate sea cruise with a different carrier from Hobart to Melbourne to meet up with the ocean liner.

    The domestic sea leg from Hobart to Melbourne is not wholly GST-free as part of an international sea voyage because the transport is not provided by the same supplier who transports Tom and Jane to Fiji.

    If the domestic voyage from Hobart to Melbourne involves transport which is used or enjoyed outside Australia there may be a GST-free component.

    End of example

    Find out more

    End of find out more

    Can you sell transport insurance GST-free?

    You can sell insurance on international passenger transport GST-free, provided the transport is wholly GST-free. This includes wholly GST-free domestic transport.

    Find out more

    GSTR 2000/33External Link Goods and services tax: international travel insurance.

    End of find out more

    Can you sell transport wholly outside Australia GST-free?

    You can sell transport (such as coach tours, train transport, hire-cars and ferry passages) to passengers from a place outside Australia to the same or another place outside Australia GST-free.

    Example

    Rachael has booked a trip to England. The itinerary includes coach tours in England and a cross-channel sea voyage. The transport and insurance are GST-free.

    End of example

    Can you sell domestic transport to non-residents GST-free?

    You can sell air transport within Australia GST-free to non-residents, provided they are outside Australia when they purchase it.

    Domestic sea transport you sell to non-residents is subject to GST to the extent that it is used or enjoyed in Australia unless the requirements discussed in Domestic transport by sea are met.

    Example

    Nils lives in Sweden and arrives in Australia for a holiday. When he booked his international transport in Sweden, he knew he wanted to visit the Northern Territory and purchased a domestic flight to Darwin as part of his itinerary. Nils's entire fare is GST-free.

    Sue-Ellen is an American resident and arrives in Australia for a holiday. While in Sydney she decides to spend a week on the Gold Coast and purchases a ticket direct from a domestic airline. Even though Sue-Ellen is a non-resident, GST will be included in the price of her domestic air ticket.

    Robyn lives in England and has booked a holiday in Australia. Robyn has decided to fly to Sydney, catch the ferry to Hobart, fly to Brisbane, cruise on a yacht to Cairns and then fly home. Robyn books the entire travel itinerary while she is in England. All the flights are GST-free; however, the ferry to Hobart and the cruise to Cairns are not GST-free as domestic legs of an international sea voyage.

    End of example

    Do you include GST in the cost of arranging the transport?

    If you arrange international transport that is wholly GST-free, the sale of the arranging service is also GST-free.

    Example

    Mac Tours organises package tours to Australia and then arranges for these packages to be sold in the USA. Part of the package involves the use of domestic air transport from Cairns to Dunk Island. Mac Tours has an agreement with Cal Air to transport non-residents from Cairns to Dunk Island. The international air transport is arranged separately.

    Arranging the international flights will be GST-free. The domestic air transport will be GST-free if the following applies:

    • there is a binding agreement between Mac Tours and Cal Air that confirms the transport of the non-resident passengers from Cairns to Dunk Island when Mac Tours purchases the domestic transport
    • the non-resident passengers are outside Australia when the travel is booked.
    End of example

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      Last modified: 19 May 2014QC 16253