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ATO Interpretative Decision

ATO ID 2004/1 (Withdrawn)

Goods and Services Tax

GST and registration of a representative of an incapacitated entity when the incapacitated entity does not, and has never, carried on an enterprise
FOI status: may be released
  • This ATOID is withdrawn in accordance with paragraph 39 of PS LA 2001/8, the contents of ATO ID 2004/1 became redundant with the introduction of ATO ID 2013/9.
    This document incorporates revisions made since original publication. View its history and amending notices, if applicable.

CAUTION: This is an edited and summarised record of a Tax Office decision. This record is not published as a form of advice. It is being made available for your inspection to meet FOI requirements, because it may be used by an officer in making another decision.

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you will need to ensure that the relevant provisions referred to in the decision have not been amended or repealed.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 an entity, a representative of an incapacitated entity, required to be registered under subsection 147-5(1) of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act), when the incapacitated entity does not, and has never, carried on an enterprise?

Decision

No. The entity is not required to be registered under subsection 147-5(1) of the GST Act when the incapacitated entity does not, and has never, carried on an enterprise.

Facts

The entity is a representative of an incapacitated entity.

The incapacitated entity is an individual that has been placed into bankruptcy. The incapacitated entity, as an individual, was not registered for goods and services tax (GST) at the time the entity was appointed and has never been required to be registered for GST. The incapacitated entity does not carry on, and has never carried on, an enterprise in its own right.

The incapacitated entity is a partner in a partnership and the partnership is registered for GST.

Reasons for Decision

Whether an entity is required to be registered, in its capacity as representative of an incapacitated entity, is determined by the provisions of subsection 147-5(1) of the GST Act.

Subsection 147-5(1) of the GST Act provides that a representative of an incapacitated entity is required to be registered in that capacity, if the incapacitated entity is registered or required to be registered.

While subsection 147-5(1) of the GST Act is relevant when considering whether the representative of an incapacitated entity is required to be registered in that capacity, section 23-5 of the GST Act sets out the registration requirements for the incapacitated entity.

Section 23-5 of the GST Act provides that an entity that carries on an enterprise and whose GST turnover meets the registration turnover threshold, is required to be registered for GST.

While the incapacitated entity is a partner in a partnership that is registered for GST, the incapacitated entity itself was not registered for GST at the time of the appointment of the entity and has never been required to be registered for GST. The incapacitated entity itself does not carry on an enterprise and as such, under section 23-5 of the GST Act, the incapacitated entity is not required to be registered.

Therefore, as the incapacitated entity is neither registered nor required to be registered for GST, the representative is not required to be registered, in its capacity as a representative of an incapacitated entity, under subsection 147-5(1) of the GST Act.

[Note: A partnership is a separate entity for the purposes of the GST Act. The enterprise of a partnership is carried on by the partnership and not by the individual partners. Consequently, the incapacitated entity, as partner, cannot register for GST in relation to the enterprise of the partnership.]

Date of decision:  3 August 2003

Legislative References:
A New Tax System (Goods and Services Tax) Act 1999
   subsection 147-5(1)
   section 23-5
   Division 184

Related ATO Interpretative Decisions
ATO ID 2003/1063

Keywords
Goods and services tax
GST registration
Required to be registered
GST special rules
Representative of incapacitated entities

Business Line:  Indirect Tax

Date of publication:  9 January 2004

ISSN: 1445-2782

history
  Date: Version:
  3 August 2003 Original statement
You are here 2 May 2014 Archived

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