ATO Interpretative Decision
ATO ID 2001/724 (Withdrawn)
Goods and Services Tax
GST and the provision of financial planning advice to an Australian clientFOI status: may be released
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This ATO ID is a straight application of the law and does not contain an interpretative decision. Further information on this issue is available in Goods and Services Tax Ruling GSTR 2002/2 - Schedule 2 - Summary of fess and advices - Advisory and Professional services - Financial Planning (J18 - J22)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you will need to ensure that the relevant provisions referred to in the decision have not been amended or repealed.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 tax agent, making a taxable supply under section 9-5 of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act), when it provides financial planning advice to its Australian client?
Decision
Yes, the entity is making a taxable supply under section 9-5 of the GST Act when it provides financial planning advice to its Australian client.
Facts
The entity is a tax agent. The entity provides financial planning advice to its Australian client for which it charges a fee.
The entity is registered for goods and services tax (GST). The entity provides the advice in the course of an enterprise that the entity carries on in Australia.
Reasons for Decision
Under section 9-5 of the GST Act, an entity makes a taxable supply if :
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- it makes the supply for consideration;
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- it makes the supply in the course or furtherance of an enterprise that it carries on;
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- the supply is connected with Australia; and
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- it is registered, or required to be registered for GST.
Section 9-10 of the GST Act defines 'supply'. Paragraph 9-10(2)(b) of the GST Act states that a supply includes a supply of services. In this case, the entity provides financial planning advice to its client. Therefore, the entity is making a supply of services as defined in section 9-10 of the GST Act.
'Consideration' is defined in subsection 9-15(1) of the GST Act to include any payment, act or forbearance in connection with, in response to or for the inducement of a supply of anything. In this case, the entity's client pays the entity a fee when the entity provides financial planning advice. This payment is consideration as defined in subsection 9-15 (1) of the GST Act.
The entity is registered for GST and the supply meets the other positive requirements of section 9-5 of the GST Act. Furthermore, the supply is neither GST-free under 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 provides financial planning advice to its Australian client.
Date of decision: 20 June 2001
Legislative References:
A New Tax System (Goods and Services Tax) Act 1999
section 9-5
section 9-10
paragraph 9-10(2)(b)
subsection 9-15(1)
Division 38
Division 40
Keywords
Goods & services tax
GST supplies & acquisitions
GST consideration
GST supply
Taxable supply
ISSN: 1445-2782
| Date: | Version: | |
| 20 June 2001 | Original statement | |
| You are here | 23 September 2005 | Archived |