ATO Interpretative Decision
ATO ID 2003/1144
Goods and Services Tax
GST and the supply of a home massage recliner chairFOI status: may be released
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you will need to ensure that the relevant provisions referred to in the decision have not been amended or repealed.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, a supplier of medical aids and appliances, making a GST-free supply under subsection 38-45(1) of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act), when it supplies a home massage recliner chair that is designed to provide therapeutic massage for people with disabilities?
Decision
Yes, the entity is making a GST-free supply under subsection 38-45(1) of the GST Act when it supplies a home massage recliner chair that is specifically designed to provide therapeutic massage for people with disabilities.
Facts
The entity is a supplier of medical aids and appliances. The entity is supplying a home massage recliner chair.
The recliner is not designed for general massage, but rather, it is designed to provide therapeutic massage for people with disabilities. The recliner is electronically operated and provides a robotic massage that simulates techniques used by massage therapists, physicians, chiropractors and other healthcare professionals.
The recliner is not widely used by people without an illness or disability.
There is no agreement between the entity and the recipient that the supply will not be treated as a GST-free supply.
The entity is registered for goods and services tax (GST).
Reasons for Decision
Under subsection 38-45(1) of the GST Act, the supply of certain medical aids and appliances is GST-free where the medical aid or appliance:
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- is covered by Schedule 3 to the GST Act (Schedule 3), or specified in the A New Tax System (Goods and Services Tax) Regulations 2019(GST Regulations)
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- is specifically designed for people with an illness or disability, and
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- is not widely used by people without an illness or disability.
Item 86 in the table in Schedule 3 (Item 86) lists 'electrically operated therapeutic lounge/recliner chairs specifically designed for people with disabilities'. The entity's recliner is not designed for general massage, but rather, it is designed to provide therapeutic massage for people with disabilities. The recliner is electronically operated and provides a robotic massage that simulates techniques used by massage therapists, physicians, chiropractors and other healthcare professionals. As such, the therapeutic recliner is specifically designed for people with disabilities and is covered by Item 86.
Furthermore, the recliner is not widely used by people without an illness or disability. Therefore, as all of the requirements of subsection 38-45(1) of the GST Act have been met, the entity is making a GST-free supply under subsection 38-45(1) of the GST Act when it supplies a home massage recliner chair that is designed to provide therapeutic massage for people with disabilities.
Amendment History
| Date of Amendment | Part | Comment |
|---|---|---|
| 9 April 2019 | Throughout | Updated A New Tax System (Goods and Services Tax) Regulations 1999 to A New Tax System (Goods and Services Tax) Regulations 2019. |
Legislative References:
A New Tax System (Goods and Services Tax) Act 1999
subsection 38-45(1)
Schedule 3
Schedule 3 table item 86
The Regulations
Keywords
Goods and services tax
GST free
GST health
Section 38-45 - medical aids & appliances
ISSN: 1445-2782