ATO Interpretative Decision
ATO ID 2004/853
Goods and Services Tax
GST and English language courses for people who do not have a student visaFOI status: may be released
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This document incorporates revisions made since original publication. View its history and amending notices, if applicable.
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you will need to ensure that the relevant provisions referred to in the decision have not been amended or repealed.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
Is the entity, a provider of English language courses, making a GST-free supply of an English language course for overseas students under section 38-85 of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act), when it supplies courses to students in Australia who did not enter Australia on a student visa?
Decision
No, the entity is not making a GST-free supply of an English language course for overseas students under section 38-85 of the GST Act when it supplies courses to students in Australia who did not enter Australia on a student visa.
The entity is making a taxable supply under section 9-5 of the GST Act.
Facts
The entity is an English language course provider. The entity provides English language courses that consist of classroom tuition, excursions and activities. The entity is accredited and listed on the Commonwealth Register of Institutions and Courses for Overseas Students (CRICOS).
The courses are not provided to overseas students who are in possession of a student visa, issued by the Department of Immigration Multicultural and Indigenous Affairs (DIMIA), as part of the overseas student program. The courses are provided to individuals who enter Australia on a tourist or working holiday visa who then decide to seek formal English language instruction during their stay.
The entity is registered for goods and services tax (GST). The courses are not GST-free as any other type of education course, and the supply of the courses satisfies all the positive limbs of a taxable supply under section 9-5 of the GST Act.
Reasons for Decision
The supply of an education course is GST-free under section 38-85 of the GST Act. The definition of an education course includes, amongst other things, 'an English language course for overseas students'.
An English language course for overseas students is defined in section 195-1 of the GST Act as a course of study or education supplied to overseas students that:
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- includes study or education in the English language, and
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- is supplied by an entity that is accredited to provide such courses by a State or Territory authority responsible for their accreditation.
An overseas student in this context is a student who is part of the overseas student program and is in possession of the relevant student visa, being the DIMIA visa classes 570-576. An overseas student, for the purposes of an English language course for overseas students, does not include an individual who is in Australia on a tourist visa, working holiday or other type of visa who decides to undertake some type of study or education.
The courses the entity provides are not available to overseas students as defined above. The entity only supplies these courses to individuals on tourist or working holiday visas.
As the individuals undertaking the courses are not overseas students, the entity is not making a GST-free supply of an English language course for overseas students under section 38-85 of the GST Act.
The entity is registered for GST and the supply satisfies the other positive limbs of section 9-5 of the GST Act. Furthermore, the supply is neither GST-free under other provision of Division 38 of the GST Act nor input taxed under Division 40 of the GST Act. Therefore, the entity is making a taxable supply under section 9-5 of the GST Act when it supplies courses to students in Australia who did not enter Australia on a student visa.
Date of decision: 7 October 2004
Legislative References:
A New Tax System (Goods and Services Tax) Act 1999
section 9-5
Division 38
section 38-85
Division 40
section 195-1
Keywords
Goods and services tax
GST education
Education courses
English language course for overseas students
Taxable supply
ISSN: 1445-2782
| Date: | Version: | |
| You are here | 7 October 2004 | Original statement |
| 13 September 2005 | Archived |