• Racing and Gambling Industry Partnership - issues register

    Where appropriate, individual issues in this issues register include a reference to a public ruling which is related to the relevant issue. In some cases, the issue is itself labelled as a public ruling for the purposes of section 105-60 of Schedule 1 to the Taxation Administration Act 1953. Where an issue in this issue register simply sets out the way the law applies, rather than dealing substantially with a question of legal interpretation, we have added to the item the description 'non-interpretative'.

    From 1 July 2010, issues labelled as a public ruling in this register will continue to be a public ruling even though section 105-60 of Schedule 1 of the Taxation Administration Act 1953 has been repealed.

    A public ruling is an expression of the Commissioner's opinion about the way in which a relevant provision applies, or would apply, to entities generally or to a class of entities in relation to a particular scheme or a class of schemes.

    If you rely on issues in this register that are a ruling, we must apply the law to you in the way set out in the ruling. However, if we are satisfied that the ruling is incorrect and disadvantages you, we may apply the law in a way that is more favourable for you - provided we are not prevented from doing so by a time limit imposed by the law. You will be protected from having to pay any underpaid tax, penalty or interest in respect of the matters covered by this ruling if it turns out that it does not correctly state how the relevant provision applies to you.

    Issues in this register that have not been labelled as public rulings, constitute written guidance. If you follow our information on these issues and it turns out to be incorrect, or it is misleading and you make a mistake as a result, we must still apply the law correctly. If that means you owe us money, we must ask you to pay it but we will not charge you a penalty. Also, if you acted reasonably and in good faith we will not charge you interest. If correcting the mistake means we owe you money, we will pay it to you. We will also pay you any interest you are entitled to.

    For GST, Luxury car tax and Wine equalisation tax purposes, from 1 July 2015, where the term ‘Australia’ is used in this document, it is referring to the ‘indirect tax zone’ as defined in subsection 195-1 of the GST Act. 

    Racing issues log

    No.

    Issues and questions

    Status

    Outcome and comments

    1

    Can resident agents acting for non-resident owners use the deferred goods and services tax (GST) scheme in the temporary importation of horses for racing in Australia?

    For source of ATO view, refer to GSTR 2003/15 - Goods and services tax: importation of goods into Australia

    Resolved -answered

    Resident agents of non-resident race horse owners can use the deferred GST scheme in the temporary importation of horses for racing. The upfront bond normally required by Australian Customs and Border Protection Services (Customs) may not have to be paid.

    2

    For GST purposes, how do you value frozen semen imported into Australia?

    Non-interpretative - Straight application of the law

    Unresolved

    Escalated to Customs.

    3

    For GST purposes, how do you value a horse imported into Australia?

    Non-interpretative - Straight application of the law

    Unresolved

    Escalated to Customs.

    4

    Should one always pay a bond in temporarily importing a horse?

    Non-interpretative - Straight application of the law

    Resolved - answered

    Racing bodies may be able to apply to Customs for exemption under special events status.

    5

    Industry concerns over delays in processing non-resident Australian business number (ABN) registrations

    Non-interpretative - Straight application of the law

    Resolved -answered

    Systems problems fixed and Business Registrations Services processed backlog of applications.

    6

    If horses are sent overseas and then come back, what are the GST implications for resident and non-resident owners and lessors?

    Non-interpretative - other reference ( see paragraphs 279 to 282 of GSTR 2003/15 - Goods and services tax: importation of goods into Australia)

    Resolved -answered

    Amendment bill deals with breeding animals that are exported and reimported into Australia.

    7

    Entity issue - what are the GST registration requirements for owners and lessors racing, breeding or training animals?

    For source of ATO view, refer to paragraphs 120 to 147 and 149 to 190 of MT 2006/1 - The New Tax System: the meaning of entity carrying on an enterprise for the purposes of entitlement to an Australian Business Number

    Resolved - answered

    There may be a single or multiple entities supplying an animal for racing. Each ownership group needs to determine who is the entity. The enterprise test is then applied to that entity. It may be possible for an ownership group to consist of GST registered and non registered entities. See the issues paper on Racing and Gambling Industry Partnership - GST and Racing Owners - Issues Register.

    8

    When a partner leaves and a new partner joins, does this new partnership need a new ABN?

    Non-interpretative - other references. Refer to:

    • paragraphs 148 to 169 of GSTR 2003/13 - Goods and services tax: general law partnerships

    • the general application of the principles in GSTR 2004/6 - Goods and services tax: tax law partnerships and co-owners of property

    Resolved - answered

    Refer to GSTR 2003/13 about general law partnerships and GSTR 2004/6 about tax law partnerships.

    9

    Withholding where no ABN quoted

    For source of ATO view, refer to TR 2002/9 - Income tax: withholding from payments where recipient does not quote ABN

    Resolved - answered

    Racing clubs need to obtain suppliers' ABN details for pay as you go (PAYG) purposes. A payee declaration may be used where supplier has no ABN and is not carrying on an enterprise to avoid PAYG withholding.

    10

    How are trophies and other non-monetary consideration treated for GST purposes?

    For source of ATO view, refer to:

    • Paragraphs 44 to 54 of GSTR 2002/3 - Goods and services tax: prizes

    • Paragraphs 138 to 165 of GSTR 2001/6 - Goods and services tax: non-monetary consideration

    Resolved - answered

    Refer to the GST rulings on Prizes, GSTR 2002/3 and to GSTR 2001/6 on non-monetary consideration.

    11

    Can an extension be sought for the 60-day rule for horses to be exported from Australia?

    Non-interpretative - other reference (see GSTR 2002/6 - Goods and Services Tax: Exports of goods, items 1 to 4A of the table in subsection 38-185(1) of the A New Tax System (Goods and Services Tax) Act 1999)

    Resolved - answered

    For exports to be GST free, the supply of goods needs to be exported within 60 days. However, an extension may be granted upon application in writing to the Commissioner.

    11a

    What is the meaning of 'necessary to prepare for export' under paragraph 38-185(3)(d) of the GST Act?

    Non-interpretative - other reference (see GSTR 2002/6 - Goods and services tax: Exports of goods, items 1 to 4 of the table in subsection 38-185(1) of the A New Tax System (Goods and Services Tax) Act 1999)

    Resolved - answered

    Refer to GSTR 2002/6 about export of goods.

    12

    Why is there inconsistency between states on the levying of the GST on racing fees and charges?

    Non-interpretative - Straight application of the law.

    Resolved - answered

    No inconsistency exists in legislation. Racing bodies to contact respective state treasury departments to seek consistency in application.

    13

    Who is required to lodge a business activity statement (BAS)?

    Non-interpretative - Straight application of the law.

    Resolved - answered

    The reporting obligations lie with the entity and not the enterprise. Therefore, all entities carrying on an enterprise and who are registered for the GST will have BAS requirements.

    14

    Can the partners of a racing partnership quarantine their external debts?

    Non-interpretative - Straight application of the law.

    Resolved - answered

    There is no known ATO policy or strategy in place to pursue partner's assets in other separate partnerships

    15

    What is included as turnover in the racing industry?

    Non-interpretative - Straight application of the law.

    Resolved - answered

    The GST turnover in the racing industry includes all monetary and most non-monetary payments you receive as a result of carrying on your enterprise. This includes all prize monies, tips or 'slings' received.

    16

    Can we change the name of the industry partnership to better reflect its role and function?

    Non-interpretative - Straight application of the law.

    Resolved - answered

    Industry partnership name changed to the 'National Racing Industry Partnership'.

    17

    Requests for determination to issue recipient created tax invoices

    Non-interpretative - other reference (see GSTR 2000/10 - Goods and services tax: recipient created tax invoices)

    Resolved - answered

    Recipients may apply for Commissioner's determination, however requests must conform with requirements specified in GSTR 2000/10.

    18

    Can importing 'agents' use the deferred GST scheme to import horses for residents?

    Non-interpretative - other reference (see the general application of the principles in GSTR 2003/15 - Goods and services tax: importation of goods into Australia).

    Resolved - answered

    Section 33-15 of the GST Act requires the 'importer' to pay GST on taxable importations. If an Australian importer appoints an agent to pay the GST on a taxable importation, the importer's agent cannot use the deferred GST scheme. The importer must either pay the GST on importation or defer payment in its own name.

    19

    Who is entitled to claim the input tax credit on a taxable importation imported under the deferred GST scheme?

    For source of ATO view, refer to paragraphs 290 to 292 of GSTR 2003/15 - Goods and services tax: importation of goods into Australia

    Resolved - answered

    Only importers who are registered for the GST are entitled to claim input tax credits on creditable importations made under the deferred GST scheme.

    Gambling issues log

    No.

    Issues and questions

    Status

    Outcome and comments

    1

    How are prize monies and winnings paid to participants and gamblers treated for GST?

    For source of ATO view, refer to GSTR 2002/3 - Goods and services tax: prizes

    Resolved - answered

    Refer to GSTR 2002/3 about prizes.

    2

    What is the GST treatment of overseas bets?

    For source of ATO view, refer to GSTR 2002/3 - Goods and services tax: prizes

    Resolved - answered

    Refer to GSTR 2002/3 about prizes.

    3

    What is the GST treatment of 'bet backs'?

    For source of ATO view, refer to Part B of GSTR 2002/3 - Goods and services tax: prizes

    Resolved - answered

    'Bet backs' are acquisitions of gambling supplies. They are not included in the global GST amount.

    4

    What is the GST treatment of reward points redeemed for cash?

    For source of ATO view, refer to paragraphs 189 to 210 of GSTR 2002/3 - Goods and services tax: prizes

    Resolved - answered

    Refer to GSTR 2002/3 about prizes.

    5

    Can a resident casino act as an agent for non-resident gambling tour operators (GTO) in respect to the supplies they make to the casino? If so, can the resident casino account for the GST on behalf of the GTOs?

    Non-interpretative - other reference (see paragraphs 28 to 54 of GSTR 2000/37 - Goods and services tax: agency relationships and the application of the law)

    Resolved - answered

    The casino can not act as agent because generally, there is no third party to whom the GTO is making supplies. That is, the supplies of the GTO is being made directly to the resident casino. Therefore, there is no agency relationship that applies to the supplies that the GTO makes to the resident casino.

      Last modified: 01 Sep 2015QC 16448