Information to help if you operate an electronic distribution platform (EDP).
Make sure you read this along with Non-resident businesses and GST and GST on imported services, digital products and low value imported goods into Australia to find out the rules that apply more generally.
You operate an electronic distribution platform (EDP) if:
- merchants can use your service to make sales to customers
- your service is delivered by electronic communication, for example, a website, online marketplace or app store.
A service isn't an EDP if it only provides:
- a carriage service, such as internet service providers and telecommunication companies
- access to a payment system or processing payments
- advertising that makes customers aware of products and links them to a merchant's website.
See also LCR 2018/2 GST on supplies made through electronic distribution platforms.
If you operate an EDP, you will generally be responsible for GST on a sale made by a merchant through your platform if:
- you are registered, or required to be registered, for GST
- it's a sale of low value imported goods to a consumer
- either you or the merchant helps to get the goods to Australia
- it's a sale of an imported service or digital product to an Australian consumer.
An EDP operator can also agree to be responsible for GST on sales made by Australian-based merchants through its platform if all of the following apply:
- Sales are digital products or digital services made electronically.
- The EDP operator has a written agreement with the merchant before the sale is made.
- The EDP operator is registered for GST.
Example: EDP operator with overseas merchant
Pacific Trends operates an app store allowing Australian consumers to buy digital products from merchants. They are registered for GST in Australia.
Eleanor uses Pacific Trends' website to buy a digital product from Electronics Co, a merchant in China for A$77 including GST.
Pacific Trends determines that it's responsible for GST on that sale as the merchant is outside Australia.
Pacific Trends is treated as a supplier for GST purposes. It returns GST of A$7 on the sale to us in its GST return.
As Pacific Trends is treated as the supplier for GST purposes, Electronics Co doesn't:
- return GST to the ATO on the sale
- count the sale when calculating if it's required to register for GST.
If sales are made through multiple EDPs, only one EDP operator is responsible for GST. The EDP operators may agree amongst themselves, by way of a written agreement, on which operator is to be responsible for the GST on the supply. Further default rules are also explained in LCR 2018/2.
A merchant (not an EDP) is responsible for GST if all of the following apply:
- A document is issued to a customer identifying both the sale and the merchant (not the EDP operator) as the supplier.
- The merchant and the EDP operator agree in writing that the merchant is responsible for paying GST on the sale.
- The EDP operator doesn't control the elements of the sale, as they don't
- authorise the charge to the recipient for the supply
- authorise the delivery of the supply
- directly or indirectly set any of the terms and conditions under which the sale is made.
Common situations where an EDP isn't responsible for GST include:
- operating an online classified website where customers can accept offers from merchants on a messaging service
- where the only influence you have on the sale is in restricting the advertising used by merchants on your website.
See also LCR 2018/2 GST on supplies made through electronic distribution platforms.Australian GST for EDPs dealing with imported services, digital products and low value imported goods.