7.a.6. Some Herbalists and naturopaths work as contractors to stores. It is understood that if a practitioner operates as an incorporated entity, the services to the store attract GST. If the practitioner is not registered for GST will the store will need to withhold tax from the gross payment for practitioner services.

Non-interpretative – straight application of the law.

In accordance with section 12-190 of Schedule 1 of the Taxation Administration Act 1953, the store may be required to withhold an amount from the payments it makes where the supplier has not quoted an ABN.

If the practitioner has supplied an ABN but is not required to be registered then there would be no GST liability for the practitioner and the store will not need to withhold.

If the practitioner has supplied an ABN and is required to be registered, then there would be a GST liability for the practitioner and the store will not need to withhold.

For further information refer to No ABN withholding - questions and answersExternal Link