Apprentice jockeys and drivers
Common issues for apprentice jockeys and drivers include:
Apprentice activities as an enterprise
You are not carrying on an enterprise if you are an apprentice jockey or a probationary driver and you receive a salary or wage for providing services to a master trainer or registered licensed trainer. Your services to the master trainer are made in the course of your employment and therefore there will be no GST implications on your salary or wage payment.
If you also provide riding or driving services to other trainers, owners and race clubs, you may be carrying on an enterprise that is subject to ABN and GST registration rules. Your GST turnover would include any riding or driving fees, track fees, prize monies and 'slings' received. However, it would not include salary or wage income.
Apprentice jockey – trust accounts
Generally, payments to you for your riding services (such as riding fees and prize money) are held in trust until the completion of your apprenticeship. If you are registered for GST, you are still required to account for the GST on these payments even though they are held in trust on your behalf.
If your GST liability exceeds your GST credits and you wish to draw the amount you owe to the ATO from your trust account, you will need to notify the trustee (usually the racing body). The trustee will generally require written advice and/or a copy of your activity statement.
Apprentice jockey – master payments
You may be obliged to pay a proportion of your total riding fees and prize monies received to your master trainer during, or on completion of, your apprenticeship. If the trainer is registered for GST, such payments are subject to GST. Your master trainer must provide you with a tax invoice in relation to the services he/she provides to you.
If you are registered for GST, you are entitled to claim GST credits for the GST paid on these master payments, provided you hold a tax invoice from your master trainer.
Example: Apprentice jockey registered for GST
Joe is an apprentice jockey employed by Rob who is a trainer. Joe also rides in races and trials for other trainers and owners. Both Joe and Rob are registered for GST.
Rob charges Joe 25% as the agreed percentage of earnings on completion of Joe's apprenticeship. On completion of his apprenticeship, Joe receives $22,000 for riding fees and $11,000 in prize money from his trust account. However, Joe would have already accounted for the GST of $3,000 in his activity statement, being one-eleventh of $33,000.
Rob charges Joe a master payment of $8,250 including $750 GST (25% of $33,000 total earnings). Joe is entitled to claim a GST credit of $750 for the GST paid.
End of example