ATO Interpretative Decision
ATO ID 2002/236
Goods and Services Tax
GST and registration of an administrator of a deed of company arrangement for two companiesFOI status: may be released
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[History note: This ATO ID was amended on 27 January 2012 to update all references to section 147-5 with references to section 58-20.]
Status of this decision: Decision Current
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you will need to ensure that the relevant provisions referred to in the decision have not been amended or repealed.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, an administrator of a deed of company arrangement (the Deed) over two companies, required to be registered twice for GST under section 58-20 of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act), once for each company subject to the Deed?
Decision
Yes, the entity is required to be registered twice for GST under section 58-20 of the GST Act, once for each company subject to the Deed.
Facts
The entity is an administrator of the Deed. The Deed is for two separate companies, company A and company B. Company A and company B are incapacitated entities.
The Deed is executed by both companies and each company is separately subject to the Deed. However, contributions received under the Deed will not be separately identified for each company.
Company A and company B are registered for GST. The companies are not grouped.
Reasons for Decision
Under section 58-20 of the GST Act, a representative of an incapacitated entity is required to be registered if the incapacitated entity is registered or required to be registered.
The term 'representative' is defined in section 195-1 of the GST Act. The definition of a representative includes an administrator of a deed of company arrangement executed by the incapacitated entity.
The entity is the administrator of a deed of company arrangement executed by company A and company B. Therefore, the entity meets the definition of a representative under section 195-1 of the GST Act. In addition, although the Deed is common to both companies, each company is separately subject to the Deed. Therefore, for the purposes of the GST Act, the entity is a representative of company A and a representative of company B.
Subsection 184-1(3) of the GST Act provides that a legal person can have a number of different capacities in which the person does things. In each of these capacities, the person is taken to be a different entity. Therefore, in accordance with subsection 184-1(3) of the GST Act, the representative of an incapacitated entity is, in that particular representative capacity, a separate entity for the purposes of the GST Act. If an entity is also the representative of other incapacitated entities, separate registration is required in respect of each representative capacity in which the entity acts.
As such, the entity is required to register separately for GST under section 58-20 of the GST Act for each company; once in its capacity as the administrator for company A and once in its capacity as administrator for company B.
Legislative References:
A New Tax System (Goods and Services Tax) Act 1999
section 58-20
subsection 184-1(3)
section 195-1
Keywords
Goods & services tax
GST registration
Required to be registered
Representative of incapacitated entities
ISSN: 1445-2782