ATO Interpretative Decision
ATO ID 2004/144
Goods and Services Tax
GST and supply of training for the purpose of licensing for a particular occupationFOI status: may be released
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you will need to ensure that the relevant provisions referred to in the decision have not been amended or repealed.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 trade association, making a GST-free supply under section 38-110 of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act), when it supplies an assessment of a person's knowledge and skills for the purpose of that person gaining a forklift license?
Decision
Yes, the entity is making a GST-free supply under section 38-110 of GST Act when it supplies an assessment of a person's knowledge and skills for the purpose of that person gaining a forklift license.
Facts
The entity is a trade association. The entity supplies an assessment of a person's knowledge and skills for the purpose of that person gaining a forklift license. The entity does not provide a training service.
It is a requirement of the person's occupation to hold a forklift licence.
The entity is registered for goods and services tax (GST).
Reasons for Decision
A supply is GST-free under subsection 38-110(1) of the GST Act when the supply is the assessment or issue of qualifications for the purpose of:
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- access to education
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- membership of a professional or trade association
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- registration or licensing for a particular occupation, or
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- employment.
Registration or licensing for a particular occupation refers to a situation where a person is required to hold a licence or be registered with an authority before they may practice or take up employment in a particular trade, profession or occupation, such as medical practitioners, plumbers, lawyers, electricians and operators of certain types of industrial equipment such as cranes and forklifts.
The entity supplies an assessment of a person's knowledge and skills for the purpose of that person gaining a forklift license. It is a requirement of the person's occupation to hold a forklift licence. Therefore, the entity's supply is for the purpose of licensing for a particular occupation. As such, the supply satisfies the requirements in subsection 38-110(1) of the GST Act.
However, subsection 38-110(2) of the GST Act provides that a supply is not GST-free under subsection 38-110(1) of the GST Act unless the supply is carried out by:
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- a professional or trade association
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- an education institution
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- an entity that is registered by a training recognition authority of a State or Territory in accordance with the Australian Recognition Framework to provide skill recognition (assessment only) services
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- an authority of the Commonwealth or of a State or Territory, or
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- a local government body.
The entity is a trade association. Therefore, the entity's supply is not excluded from being GST-free under subsection 38-110(2) of the GST Act.
Accordingly, the entity is making a GST-free supply under section 38-110 of the GST Act when it supplies an assessment of a person's knowledge and skills for the purpose of that person gaining a forklift license.
Date of decision: 11 November 2002
Legislative References:
A New Tax System (Goods and Services Tax) Act 1999
section 38-110
subsection 38-110(1)
subsection 38-110(2)
Keywords
Goods and services tax
GST free
GST education
Recognition of prior learning
ISSN: 1445-2782