A New Tax System (Goods and Services Tax) Regulations 2019

Chapter 3 - The exemptions  

Part 3-1 - Supplies that are not taxable supplies  

Division 40 - Input taxed supplies  

Subdivision 40-A - Financial supplies  

40-5.09   What supplies are financial supplies  

40-5.09(1)  
The provision, acquisition or disposal of an interest mentioned in subsection (3) is a financial supply if:


(a) the provision, acquisition or disposal is:


(i) for consideration; and

(ii) in the course or furtherance of an enterprise; and

(iii) connected with the indirect tax zone; and


(b) the supplier is:


(i) registered or required to be registered; and

(ii) a financial supply provider in relation to supply of the interest.

40-5.09(2)  
However, if Division 84 (offshore supplies) of the Act applies to the provision, acquisition or disposal of an interest mentioned in subsection (3), the provision, acquisition or disposal is a financial supply to the extent that it would, apart from subparagraphs (1)(a)(iii) and (b)(i), be a financial supply.

40-5.09(3)  
For the purposes of subsections (1) and (2), the interest is an interest in or under a matter mentioned in an item in the following table.


Financial supplies
Item An interest in or under [mldr ]
1 An account made available by an Australian ADI in the course of:
(a) its banking business within the meaning of the Banking Act 1959 ; or
(b) its State banking business
2 A debt, credit arrangement or right to credit, including a letter of credit
3 A charge or mortgage over real or personal property
4 A regulated superannuation fund, an approved deposit fund, a pooled superannuation trust or a public sector superannuation scheme within the meaning of the Superannuation Industry (Supervision) Act 1993 , or a retirement savings account within the meaning of the Retirement Savings Accounts Act 1997
5 An annuity or allocated pension
6 A life insurance business (within the meaning of the Life Insurance Act 1995 ):
(a) which consists of the issuing of life policies (within the meaning of that Act); or
(b) to which a declaration under subsection 12(2) or section 12A of that Act applies; or related reinsurance business
7 A guarantee
7A An indemnity that holds a person harmless from any loss as a result of a transaction the person enters with a third party
8 Credit under a hire purchase agreement entered into before 1 July 2012 in relation to goods, if:
(a) the credit for the goods is provided for a separate charge; and
(b) the charge is disclosed to the recipient of the goods
9 Australian currency, the currency of a foreign country, digital currency or an agreement to buy or sell any of these 3 things
10 Securities, including:
(a) a debenture described in paragraph (a), (b), (c), (e) or (f) of the definition of debenture in section 9 of the Corporations Act 2001 ; and
(b) a document issued by an individual that would be a debenture if it were issued by a body corporate; and
(c) a scheme described in paragraph (e), (i) or (m) of the definition of managed investment scheme in section 9 of the Corporations Act 2001 ; and
(d) the capital of a partnership or trust
11 A derivative
12 An account made available by a non-resident in the course of carrying on banking business (within the meaning of the Banking Act 1959 ) in a foreign country in which the entity is authorised under the law of that country to carry on banking business
13 A foreign superannuation fund (within the meaning of the Income Tax Assessment Act 1997 )

Note 1:

If something is within the scope of both an item in the table in this subsection and an item in the table in section 40-5.12 , it will not be a financial supply (see paragraph 40-5.08(a) ).

Note 2:

Subparagraph (1)(b)(ii) has the effect that a supply by a financial supply facilitator is not a financial supply.

Note 3:

Supply of something that is mentioned in more than one item in the table in this subsection will still be a financial supply.

40-5.09(4)  
A supply by an Australian ADI for a fee of not more than $1,000 is a financial supply if:


(a) item 1 of the table in subsection (3) does not apply to the supply because the recipient of the supply does not have an account with the ADI but the item would have applied to the supply if the recipient had an account with the ADI; or


(b) the fee relates to an application to the ADI that, if accepted, would result in the creation of an account by the ADI.

Example 1:

For paragraph (a), electronic transfer to another Australian ADI for a person who does not hold an account with the ADI.

Example 2:

For paragraph (b), a loan application fee.

40-5.09(5)  
A supply by an entity for a fee of not more than $1,000 is a financial supply if it is a supply of one or more of the following ATM services:


(a) a withdrawal from an account;


(b) a deposit into an account;


(c) an electronic transfer from an account;


(d) advice of the balance of an account.

40-5.09(6)  
A reference in item 10 of the table in subsection (3) to a security does not include a security in relation to which an entity is given a right to participate in a barter scheme under which each participant may obtain goods or services from another participant for consideration that is wholly or substantially in kind rather than in cash.




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