ATO Interpretative Decision
ATO ID 2001/263
Goods and Services Tax
GST and Approval for a GST joint ventureFOI status: may be released
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This ATOID provides you with the following level of protection:
If you reasonably apply this decision in good faith to your own circumstances (which are not materially different from those described in the decision), and the decision is later found to be incorrect you will not be liable to pay any penalty or interest. However, you will be required to pay any underpaid tax (or repay any over-claimed credit, grant or benefit), provided the time limits under the law allow it. If you do intend to apply this decision to your own circumstances, you will need to ensure that the relevant provisions referred to in the decision have not been amended or repealed. You may wish to obtain further advice from the Tax Office or from a professional adviser.
Issue
Can the joint venture be approved as a GST joint venture under section 51-5 of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act), where some of the participants in the joint venture are not registered for goods and services tax (GST)?
Decision
No, the joint venture cannot be approved as a GST joint venture under section 51-5 of the GST Act where some of the participants of the joint venture are not registered for GST.
Facts
The participants in the joint venture are an individual and a trust.
The trust is registered for GST. The individual is not registered for GST.
Reasons for Decision
Under paragraph 51-5(1)(d) of the GST Act, one of the requirements for the Commissioner to approve two (2) or more entities as the participants in a GST joint venture is that each of the entities must satisfy the participation requirements for that GST joint venture.
Section 51-10 of the GST Act sets out what is required for an entity to satisfy the participation requirements for a GST joint venture, or a proposed GST joint venture. Paragraph 51-10(c) of the GST Act requires an entity to be registered to satisfy the participation requirements for a GST joint venture.
In this case, one of the participants in the proposed GST joint venture, the individual, is not registered for GST. As such, the individual does not satisfy the participation requirements for a GST joint venture.
Therefore, the Commissioner will not approve the two entities as participants in a GST joint venture under section 51-5 of the GST Act, as one of the entities does not satisfy the participation requirements of a GST joint venture.
Date of decision: 14 June 2001
Legislative References:
A New Tax System (Goods and Services Tax) Act 1999
section 51-5
section 51-10
paragraph 51-10(c)
paragraph 51-5(1)(d)
Keywords
Goods & services tax
GST joint ventures
ISSN: 1445-2782
| Date: | Version: | |
| You are here | 14 June 2001 | Original statement |
| 2 September 2005 | Archived |