ATO Interpretative Decision
ATO ID 2002/993 (Withdrawn)
Goods and Services Tax
GST and counselling by a social workerFOI status: may be released
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This ATO ID is withdrawn as it is a straight application of the law and does not contain an interpretative decision.This document incorporates revisions made since original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you will need to ensure that the relevant provisions referred to in the decision have not been amended or repealed.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 social worker, making a GST-free supply under subsection 38-10(1) of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act), when it supplies counselling to a patient as a component of its supply of social work?
Decision
Yes, the entity is making a GST-free supply under subsection 38-10(1) of the GST Act when it supplies counselling to a patient as a standard component or technique of its supply of social work, where the services are generally accepted in the social work profession as being necessary for the appropriate treatment of the patient.
Facts
The entity is a social worker. The entity supplies counselling to a patient as a standard component or technique of its supply of social work services.
The patient individually engages and pays the social worker to supply the services.
The entity is a member of the Australian Association of Social Workers (a national association with uniform national registration requirements for the supply of social work services).
The entity is registered for goods and services tax (GST).
Reasons for Decision
Under subsection 38-10(1) of the GST Act, an entity makes a GST-free supply of health services if:
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- it provides a service of a kind specified in the table in subsection 38-10(1) of the GST Act or of a kind specified in the A New Tax System (Goods and Services Tax) Regulations 1999 (GST Regulations) (paragraph 38-10(1)(a) of the GST Act);
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- the entity is a recognised professional in relation to the supply of services of that kind (paragraph 38-10(1)(b) of the GST Act); and
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- the supply would generally be accepted, in the profession associated with supplying services of that kind, as being necessary for the appropriate treatment of the recipient of the supply (paragraph 38-10(1)(c) of the GST Act).
Counselling is not listed in the table in subsection 38-10(1) of the GST Act or in the GST Regulations. Therefore, counselling, in itself, does not satisfy the requirement in paragraph 38-10(1)(a) of the GST Act.
However, the requirement in paragraph 38-10(1)(a) of the GST Act may be satisfied where the supplier is supplying one of the services listed in the table in subsection 38-10(1) of the GST Act and counselling is a standard component or technique of the supply of that listed service.
Psychology' and 'Social Work' are services in the table in subsection 38-10(1) for which counselling may be considered a standard component or technique of the supply.
The entity is supplying social work services and counselling is a standard component or technique of the supply of social work services.
Social work is a service that is listed in the table in subsection 38-10(1) of the GST Act. Accordingly, the requirement in paragraph 38-10(1)(a) of the GST Act is satisfied.
For the purposes of paragraph 38-10(1)(b) of the GST Act, a recognised professional must provide the service.
Section 195-1 of the GST Act provides that a person is a recognised professional in relation to a supply of services of a kind specified in subsection 38-10(1) of the GST Act if:
- (a)
- 'the service is supplied in a State or Territory in which the person has permission or approval, or is registered, under a State or Territory law prohibiting the supply of services of that kind without such permission approval or registration;
- (b)
- the service is supplied in a State or Territory in which there is no State or Territory law requiring such permission, approval, or registration, and the person is a member of a professional association that has uniform national registration requirements relating to the supply of services of that kind; or
- (c)
- ...'.
The entity is supplying social work services. There is no State or Territory law that prohibits a person from supplying social work without permission, approval or registration. Accordingly, in relation to the supply of social work, a person is a recognised professional if that person is a member of a professional association that has uniform national registration requirements relating to the supply of social work services.
The entity is a member of the national association with uniform national registration requirements for the supply of social work services - the Australian Association of Social Workers. Therefore, the entity is a recognised professional in relation to the supply of social work and the requirement in paragraph 38-10(1)(b) of the GST Act is satisfied.
The third requirement in subsection 38-10(1) of the GST Act is that the supply must be generally accepted, in the relevant profession, as being necessary for the appropriate treatment of the recipient of the supply.
As the patient individually engages and pays the social worker to supply the services, the patient is the recipient of the supply.
It is considered that 'appropriate treatment' will be established where an entity assesses that patient's state of health and determines a process to pursue, in an attempt to preserve, restore or improve the physical or psychological wellbeing of that patient to the extent that their training allows. 'Appropriate treatment' includes the principles of preventative medicine.
Additionally, the phrase 'generally accepted in the profession' indicates that it is the relevant profession that determines what services are generally accepted.
Therefore, where the entity supplies a service of social work and assesses the patient's state of health and determines a process to pursue to preserve, restore or improve the physical or psychological wellbeing of the patient and the social work profession generally accepts this treatment as appropriate, the requirements in paragraph 38-10(1)(c) of the GST Act are also met.
The entity meets the requirements of subsection 38-10(1) of the GST Act. Therefore, the supply of social work services by the entity is GST-free where the service is generally accepted in the social work profession as being necessary for the appropriate treatment of the recipient of the supply.
Legislative References:
A New Tax System (Goods and Services Tax) Act 1999
subsection 38-10(1)
paragraph 38-10(1)(a)
paragraph 38-10(1)(b)
paragraph 38-10(1)(c)
section 195-1
The Regulations Related ATO Interpretative Decisions
ATO ID 2001/390
Other References:
Health Issues Register
Keywords
Goods & services tax
GST free
GST health
Section 38-10 - other health services
ISSN: 1445-2782
| Date: | Version: | |
| 9 August 2001 | Original statement | |
| You are here | 22 June 2007 | Archived |