Edited version of your written advice

Authorisation Number: 1051242630194

Date of advice: 29 June 2017

Ruling

Subject: Goods and Services Tax (GST) and medical aids and appliances and National Disability Insurance Scheme

Question 1

Are your sales of the following products GST-free under section 38-38 of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act) where they are requested via the National Disability Insurance Scheme (NDIS) and they are within the scope of the NDIS participant’s plan?

● Grab rails for toilets

● Grab rails for showers

● Grab rails for baths

● Toilet backrests

● Wall folding shower chair

● Shower sets with a (length) metre hose

● Disabled toilets

● Ambulant toilets

● Disabled hand basins

● Disabled shelf

● Specialised tap

● Specialised disabled door hardware (various types of handles).

● Wheelchair access mats

● Braille sign for unisex toilet LH, which includes information for non-vision impaired people

● Braille sign for unisex toilet RH, which includes information for non-vision impaired people

● Braille sign for unisex toilet LH + shower, which includes information for non-vision impaired people

● Braille sign for unisex toilet RH + shower, which includes information for non-vision impaired people

● Braille sign for male ambulant toilet, which includes information for non-vision impaired people

● Braille sign for female ambulant toilet, which includes information for non-vision impaired people

● Braille sign for unisex ambulant toilets which includes information for non-vision impaired people

● Braille sign for male toilet, which includes information for non-vision impaired people

● Braille sign for female toilet, which includes information for non-vision impaired people.

Answer

Yes.

Question 2

Are your sales of the following products GST-free under section 38-45 of the GST Act?

● Grab rails for toilets

● Grab rails for showers

● Grab rails for baths

● Toilet backrests

● Wall folding shower chair

● Shower sets with a (length) metre hose

● Disabled toilets

● Ambulant toilets

● Disabled hand basins

● Disabled shelf

● Specialised tap

● Specialised disabled door hardware (various types of handles)

● Wheelchair access mats

● Braille sign for unisex toilet LH, which includes information for non-vision impaired people and Braille translation

● Braille sign for unisex toilet RH, which includes information for non-vision impaired people and Braille translation

● Braille sign for unisex toilet LH + shower, which includes information for non-vision impaired people and Braille translation

● Braille sign for unisex toilet RH + shower, which includes information for non-vision impaired people and Braille translation

● Braille sign for male ambulant toilet, which includes information for non-vision impaired people and Braille translation

● Braille sign for female ambulant toilet, which includes information for non-vision impaired people and Braille translation

● Braille sign for unisex ambulant toilets which includes information for non-vision impaired people and Braille translation

● Braille sign for male toilet, which includes information for non-vision impaired people and Braille translation

● Braille sign for female toilet, which includes information for non-vision impaired people. and Braille translation

Answer

Question 3

Is GST payable on your supply of a kit that contains a toilet grab rail; a toilet backrest and a Braille sign for a disabled toilet (the sign also includes information for sighted people)?

Answer

GST is not payable on the grab rail and backrest.

GST is payable on the Braille sign, unless the sign is requested via the NDIS.

Relevant facts and circumstances

You are registered for GST.

You sell a range of bathroom related devices to assist people with a disability.

You supply your products wholly within Australia. You do not export products.

All new commercial buildings must meet AS 1428.1, which is a standard relating to constructing bathroom facilities for the disabled. You sell a range of devices that are specifically designed as medical aids to support handicapped, wheelchair-bound and vision impaired people. This equipment is manufactured to exact specifications to meet AS 1428.1. These products are not standard everyday items used by the general public. These products include the following devices:

● Grab rails for toilets

● Grab rails for showers

● Grab rails for baths

● Toilet backrests

● Wall folding shower chair

● Shower sets with a (length) hose

● Disabled toilets

● Ambulant toilets

● Disabled hand basins

● Disabled shelf

● Specialised tap

● Specialised disabled door hardware (various types of handles)

● Wheelchair access mats

Toilet grab rail

Your toilet grab rails are specifically designed to be used by a disabled person to assist them when they are using a toilet. They support the weight of a disabled person when they are using a toilet.

Two grab rails must be installed for use in connection with ambulant toilets.

Shower grab rail

Your shower grab rails are specifically designed to be used by a disabled person to assist them when they are using a shower. They support the weight of a disabled person when they are using a shower.

Bath grab rail

Your bath grab rails are specifically designed to be used by a disabled person to assist them when they are using a bath. They support the weight of a disabled person when they are using a bath.

The backrest unit

The backrest unit contains a backrest and metal frame/bars attached to the back of the backrest and which support the backrest. The backrest unit goes around the cistern of the toilet and the bars of the unit are affixed to the wall. The backrest unit supports the weight of a disabled person when they are using the toilet and the bars can be used as a grab rail.

Disabled shelf

This shelf is installed next to a basin and is for putting soap etc on.

Specialised disabled door hardware

The specialised disabled hardware has particular design features to suit any people with certain disabilities.

There are various setups for various types of doors. They are specifically designed to go onto disabled bathrooms. They will suit people with (particular disability) for example. These disabled bathrooms try to cover all people with a variety of disabilities.

Braille signs

You also sell the following Braille signs, which provide information about the presence of various bathroom facilities:

● Braille sign for unisex toilet LH, which includes information for non-vision impaired people and Braille translation

● Braille sign for unisex toilet RH, which includes information for non-vision impaired people and Braille translation

● Braille sign for unisex toilet LH + shower, which includes information for non-vision impaired people and Braille translation

● Braille sign for unisex toilet RH + shower, which includes information for non-vision impaired people and Braille translation

● Braille sign for male ambulant toilet, which includes information for non-vision impaired people and Braille translation

● Braille sign for female ambulant toilet, which includes information for non-vision impaired people and Braille translation

● Braille sign for unisex ambulant toilets which includes information for non-vision impaired people and Braille translation

● Braille sign for male toilet, which includes information for non-vision impaired people and Braille translation

● Braille sign for female toilet, which includes information for non-vision impaired people. and Braille translation

These signs contain Braille information as well as information for sighted people (such as picture symbols and lettering). An example is a unisex toilet left hand transfer and shower sign. This sign includes:

● Braille information

● picture symbols for a man and a woman and a shower head

● the words 'Unisex Toilet LH & Shower’

Kit containing three devices

You also sell a kit, which includes three items, being a toilet grab rail; a toilet backrest and a Braille sign.

You provided a photo of a Left Hand Transfer kit to the ATO. The photo includes a Braille sign. The sign also includes picture symbols for a man and women and a wheelchair and the words 'Unisex Toilet LH’.

NDIS arrangements

You sell products that are requested via the National Disability Insurance Scheme (NDIS) and which are within the scope of the NDIS participant’s (the disabled person’s) plan. In these cases, you enter into a written agreement ('the written agreement’) with the participant or another person and this agreement identifies the participant. Your supply of the relevant product to the participant is a reasonable and necessary support specified in the statement that is included under subsection 33(2) of the NDIS Act, in the participant’s plan and the 'written agreement’ specifies the same.

Relevant legislative provisions

A New Tax System (Goods and Services Tax) Act 1999 Section 9-5

A New Tax System (Goods and Services Tax) Act 1999 Section 9-40

A New Tax System (Goods and Services Tax) Act 1999 Section 38-38

A New Tax System (Goods and Services Tax) Act 1999 Subsection 38-45(1)

A New Tax System (Goods and Services Tax) Act 1999 Schedule 3

A New Tax System (Goods and Services Tax) Regulations 1999 Regulation 38.45.01

Reasons for decisions

Question 1

GST is payable on your taxable supplies.

You make a taxable supply where you satisfy the requirements of section 9-5 of the GST Act, which states:

You make a taxable supply if:

(a) you make the supply for *consideration; and

(b) the supply is made in the course or furtherance of an *enterprise that

you *carry on; and

(c) the supply is *connected with the indirect tax zone; and

(d) you are *registered, or *required to be registered.

However, the supply is not a *taxable supply to the extent that it is *GST-free

or *input taxed.

(*Denotes a term defined in the GST Act)

The indirect tax zone is Australia.

You meet the requirements of section 9-5 of the GST Act as:

● you supply the products in question for consideration

● you supply the products in the course or furtherance of an enterprise that you carry on

● these supplies are connected with Australia, and

● you are registered for GST.

There are no provisions of the GST Act under which your sales of the products are input taxed.

Therefore, what remains to be determined is whether your sales of the products are GST-free.

The relevant GST-free provisions are section 38-38 and section 38-45 of the GST Act.

Exemption for supplies made under NDIS scheme

Section 38-38 of the GST Act states:

A supply is GST-free if the supply:

(a) is a supply to a participant (within the meaning of the

National Disability Insurance Scheme Act 2013) for whom a

participant’s plan is in effect under section 37 of that Act; and

(b) is a supply of one or more of the reasonable and necessary

supports specified in the statement included, under subsection

33(2) of that Act, in the participant’s plan; and

(c) is made under a written agreement, between the supplier and

the participant or another person that

(i) identifies the participant; and

(ii) states that the supply is of one or more of the

reasonable and necessary supports specified in the

statement included, under subsection 33(2) of that Act,

in the participant’s plan; and

(d) is of a kind that the *Disability Services Minister has

(e) determined in writing.

GST-free Supply (National Disability Insurance Scheme Supports) Determination 2013 is the determination made by the disability service Minister pursuant to paragraph 38-38(d) of the GST Act.

Clause 4 (Supplies that are GST-free) of GST-free Supply (National Disability Insurance Scheme Supports) Determination 2013 states:

For the purposes of paragraph 38-38(d) of the Act, a supply of a kind described in Schedule 1 is GST-free if the supply also meets the other requirements of section 38-38 of the Act.

GST-free Supply (National Disability Insurance Scheme Supports) Determination 2013 specifies 'home modification design and construction*’ at item 15 in Schedule 1.

(*if it is a supply of a kind listed in:

● Schedule 1 to the GST-free Supply (Care) Determination 2000;

● Schedule 1 to the GST–free Supply (Residential Care – Government-Funded Supplier) Determination 2000; or

● Clause 4 of the GST-free Supply (Health Services) Determination 2000.)

Schedule 1 in GST-free Supply (Care) Determination 2000 specifies 'home modifications’ at item 4.

Where you are requested via the NDIS to supply the products in question for use in an NDIS participant’s home, they will be covered by the home modifications items in GST-free Supply (National Disability Insurance Scheme Supports) Determination 2013 and GST-free Supply (Care) Determination 2000. Additionally, you would meet the requirements of paragraphs (a) to (c) of section 38-38 of the GST Act. Therefore, the requirement of paragraph 38-38(d) of the GST Act would be met.

As you would meet all of the requirements of section 38-38 of the GST Act under the circumstances, your supply of the products in question where requested via the NDIS are GST-free under that provision.

Question 2

GST-free sales of specified medical aids and appliances

Summary

Some of the devices are GST-free under section 38-45 of the GST Act as:

● they are covered by an item in Schedule 3 to the GST Act, and

● they are specifically designed for people with an illness or disability and would not be widely used by people without an illness or disability.

The other devices are not covered by an item in Schedule 3 to the GST Act or Schedule 3 to the GST Regulations (A New Tax System (Goods and Services Tax) Regulations 1999), and therefore, they are not GST-free under subsection 38-45(1) of the GST Act.

Detailed reasoning

A sale of a medical aid or appliance is GST-free where it meets the requirements of subsection 38-45(1) of the GST Act, which states:

A supply is GST-free if:

(a) it is covered by Schedule 3 (medical aids and appliances), or

specified in the regulations; and

(b) the thing supplied is specifically designed for people with an

illness or disability, and is not widely used by people without

an illness or disability.

Schedule 3 to the GST Act specifies the following devices:

● Bidet/bidet toilet attachments (Item 51)

● Special door fittings relating to the disability of a particular person (Item 52)

Schedule 3 to the GST Act specifies the following devices under the category heading 'Personal hygiene for people with disabilities’:

● Bathboards or toilet seats for people with disabilities (Item 111)

● Bath supports (Item 112)

● Shower chairs or stools (Item 113)

● Shower supports (Item 114)

● Shower trolleys (Item 115)

● Mobile shower chairs (Item 116)

● Commodes (Item 117)

● Commode cushions (Item 118)

● Commode pans (Item 119)

● Trolley frames (Item 120)

● Toilet supports (Item 121)

● Self-help poles (Item 122)

Schedule 3 to the GST Regulations specifies 'customised modifications and accessories for the aids or appliances mentioned in items 111 to 121 of Schedule 3 to the GST Act’.

Grab rails – for toilets; used by disabled

ATO Interpretative Decision ATO ID 2002/535 Goods and Services Tax GST and supply of a toilet support rail discusses toilet supports. It states:

Item 121 in the table in Schedule 3 (Item 121) lists 'toilet supports'. A toilet support is an aid or appliance that has design characteristics such that it assists a disabled person when they are using a toilet. In addition, generally it must be able to support the weight of the disabled person.

A toilet grab rail may possess the characteristics of a toilet support and be identifiable as a toilet support either at the point of manufacture or, in the case of a generic grab rail, at the point of installation in a toilet area. A toilet grab rail is covered by Item 121 if it has the characteristics of and is identifiable as being a toilet support when it is supplied.

Your toilet grab rails are specifically designed to be used by a disabled person to assist them when they are using a toilet. They support the weight of a disabled person when they are using a toilet. Therefore, your toilet grab rails are covered by Item 121 in Schedule 3 to the GST Act.

Your toilet grab rails are not widely used by people without an illness or disability. They are not standard everyday items used by the general public.

As such, your supplies of these toilet grab rails satisfy subsection 38-45(1) of the GST Act and are GST-free. Therefore, GST is not payable on these sales.

Grab rails – for showers; used by disabled

ATO Interpretative Decision ATO ID 2002/441 Goods and Services Tax GST and bathroom rod accessories states:

For a bathroom rod to be accepted as a bath support, a shower support, or a toilet support, it is considered that the bathroom rod must be able to support the weight of an individual when the rod is attached to a wall.

Your shower grab rails are specifically designed to be used by a disabled person to assist them when they are using a shower. They support the weight of a disabled person when they are using a shower. Therefore, your shower grab rails are covered by Item 114 IN Schedule 3 to the GST Act.

Your shower grab rails are not widely used by people without an illness or disability. They are not standard everyday items used by the general public.

As such, your supplies of these shower grab rails satisfy subsection 38-45(1) of the GST Act and are GST-free. Therefore, GST is not payable on these sales.

Grab rails – for baths; used by disabled

Your bath grab rails are specifically designed to be used by a disabled person to assist them when they are using a bath. They support the weight of a disabled person when they are using a bath. Therefore, your bath grab rails are covered by Item 112 in Schedule 3 to the GST Act.

Your bath grab rails are not widely used by people without an illness or disability. They are not standard everyday items used by the general public.

As such, your supplies of these bath grab rails satisfy subsection 38-45(1) of the GST Act and are GST-free. Therefore, GST is not payable on these sales.

Toilet backrests

Your toilet backrests are specifically designed to be used by a disabled person to assist them when they are using a toilet. They support the weight of a disabled person when they are using a toilet. Therefore, your toilet backrests are covered by Item 121 in Schedule 3 to the GST Act.

Your toilet backrests are not widely used by people without an illness or disability. They are not standard everyday items used by the general public.

As such, your supplies of these toilet backrests satisfy subsection 38-45(1) of the GST Act and are GST-free. Therefore, GST is not payable on these sales.

Wall folding shower chairs

Item 113 in Schedule 3 to the GST Act specifies shower chairs and stools.

Your wall folding shower chairs are specifically designed and manufactured for use by the disabled while in the shower. Therefore, your supplies of these chairs are covered by Item 113. They are not widely used by people without an illness or disability. As such, the supply of these chairs satisfies subsection 38-45(1) of the GST Act and is GST-free. Therefore, GST is not payable on these sales.

Shower set with (length) meter hose

These shower sets are not covered by Schedule 3 to the GST Act or Schedule 3 to the GST Regulations. Therefore, your sales of these shower sets are not GST-free under subsection 38-45(1) of the GST Act. GST will be payable on your sales of these shower sets unless they are GST-free under the NDIS exemption.

Toilet suites (disabled and ambulant)

The Macquarie online dictionary, 6^th edition, states that a bidet is 'a small low bath, straddled by the user, for washing the external genitals, anus, and surrounding area’.

The Macquarie online dictionary, 6^th edition, states that a commode is 'a stand or cupboard containing a chamber pot or washbasin’.

It is not considered that a toilet suite is a bidet or commode and as such does not satisfy Item 51 or Item 117 in Schedule 3 to the GST Act. There are no other items in Schedule 3 to the GST Act or Schedule 3 to the GST Regulations that specify toilet suites and as such toilet suites do not satisfy subsection 38-45(1) of the GST Act.

Therefore, your sales of toilet suites are not GST-free under subsection 38-45(1) of the GST Act. GST will be payable on your sales of these toilets unless they are GST-free under the NDIS exemption.

Disabled hand basins

These hand basins are not covered by Schedule 3 to the GST Act or Schedule 3 to the GST Regulations. Therefore, your sales of these basins are not GST-free under subsection 38-45(1) of the GST Act. GST will be payable on your sales of these basins unless they are GST-free under the NDIS exemption.

Disabled shelf

The disabled shelf is not covered by Schedule 3 to the GST Act or Schedule 3 to the GST Regulations. Therefore, your sales of these shelves are not GST-free under subsection 38-45(1) of the GST Act. GST will be payable on your sales of these shelves unless they are GST-free under the NDIS exemption.

Specialised tap

These taps are not covered by Schedule 3 to the GST Act or Schedule 3 to the GST Regulations.

Therefore, your sales of these taps are not GST-free under subsection 38-45(1) of the GST Act. GST will be payable on your sales of these taps unless they are GST-free under the NDIS exemption.

Specialised disabled door hardware

Item 52 in the table in Schedule 3 to the GST Act (Item 52) lists 'special door fittings relating to the disability of a particular person'.

ATO Interpretative Decision ATO ID 2002/991 Goods and Services Tax GST and modifications made to doors relating to the disability of a particular person states:

The phrase 'relating to the disability of a particular person' means that, when supplied, the special door fittings must be customised in such a way that the method of operation of the door relates specifically to the needs or requirements of a particular disabled person.

At the time you sell the specialised disabled door hardware, they are not customised specifically to meet the needs or requirements of a particular disabled person, although they are designed to cover all people with a variety of disabilities. Therefore, they are not covered by Item 52.

Your door hardware products are not covered by Schedule 3 to the GST Act or Schedule 3 to the GST Regulations. Therefore, your sales of these products are not GST-free under subsection 38-45(1) of the GST Act. GST will be payable on your sales of these door handles unless they are GST-free under the NDIS exemption.

Wheelchair access mats

These mats are not covered by Schedule 3 to the GST Act or Schedule 3 to the GST Regulations.

Therefore, your sales of these mats are not GST-free under subsection 38-45(1) of the GST Act. GST will be payable on your sales of these mats unless they are GST-free under the NDIS exemption.

Braille signs (which include information for sighted people and Braille translation)

Item 151 in the table in Schedule 3 to the GST Act (Item 151) lists auditory / tactile alerting devices. The phrase auditory / tactile alerting devices is not defined in the GST Act so accordingly, it is appropriate to examine the ordinary meaning of that phrase.

ATO Interpretative Decision ATO ID 2005/79 Goods and Services Tax GST and signs containing words, diagrams and Braille translation discusses Braille signs. It states:

Item 151 in the table in Schedule 3 (Item 151) lists 'auditory/tactile alerting devices'. The phrase 'auditory/tactile alerting devices' is not defined in the GST Act. Accordingly, it is appropriate to examine the ordinary meaning of that phrase.

The Macquarie Dictionary (1997), 3rd edn, The Macquarie Library Pty Ltd, New South Wales defines 'auditory' to mean 'relating to hearing, or the sense of hearing ...', 'tactile' to mean '1. of or relating to the organs of sense or touch. 2. perceptible to the touch...'; and 'alert' to mean '...4. an alarm or warning..'

Accordingly, an auditory/tactile alerting device is a device which is designed to alert a visually impaired person to a presence, occurrence or danger through the person's sense of touch or hearing.

The entity's sign comprises words, diagrams and a corresponding Braille translation and is designed to alert both the sighted and visually impaired to the presence and location of various things inside and outside of the public building. The Braille component of the sign uses Braille to relay this information to the visually impaired through their sense of touch. Due to its Braille component, the sign is an auditory/tactile alerting device and is covered by Item 151.

The remaining requirements in subsection 38-45(1) of the GST Act are that the sign must be specifically designed for people with an illness or disability and not widely used by people without an illness or disability. The sign is designed for and installed in public buildings. It is used by any person, whether sighted or visually impaired, who enters that building and uses the sign for information. Therefore, the sign is widely used by people without an illness or disability. As such, the supply of the sign does not meet the remaining requirement of subsection 38-45(1) of the GST Act and is not GST-free.

Your Braille signs are devices which are designed to alert a visually impaired person to a presence of something through the person’s sense of touch. Due to the Braille component, the signs are auditory/tactile alerting devices and are covered by Item 151.

The Braille signs in question also have information for sighted people, for example, picture symbols and letters.

The Braille sign products in your case are used by any person, whether sighted or visually impaired who enters buildings or areas where the signs are placed and uses the signs for information. Therefore, these products are widely used by people without an illness of or disability. As such, the supplies of the signs in question do not meet the remaining requirement of subsection 38-45(1) of the GST Act and they are not GST-free under that subsection. GST will be payable on your sales of these signs unless they are GST-free under the NDIS exemption.

Question 3

The kit in question contains three discretely separate items. To determine the GST status of the kit, we need to determine whether the supply of the kit is a mixed supply or instead a composite supply.

Paragraphs 16 and 16A of GSTR 2001/8 explain the concept of a mixed supply. They state:

Mixed supply

16. In this Ruling the term 'mixed supply' is used to describe a supply that has to be separated or unbundled as it contains separately identifiable taxable and non-taxable parts that need to be individually recognised.

16A Paragraphs 45 to 54C of this Ruling explain how to identify whether a supply has separately identifiable parts.

Paragraphs 17 to 18A of GSTR 2001/8 explain the concept of a composite supply. They state:

Composite supply

17. In this Ruling, the term 'composite supply' is used to describe a supply that contains a dominant part and includes something that is integral, ancillary or incidental to that part. You treat a composite supply as a supply of a single thing. Paragraphs 55 to 63 explain what are integral, ancillary or incidental parts.

18. A composite supply is either taxable or non-taxable. It may also be a part of a larger mixed supply.

18A. You need to consider all of the circumstances of a supply to work out whether the supply is mixed or composite. GST is only payable on the taxable part of a mixed supply. If a composite supply is taxable, then GST is payable on the whole supply. If a composite supply is non-taxable, then no GST is payable on the supply.

Paragraph 59 of GSTR 2001/8 provides guidance on determining whether an item is integral, ancillary or incidental to the dominant part of a supply. It states:

59. No single factor (by itself) will provide the sole test you use to determine whether a part of a supply is integral, ancillary or incidental to the dominant part of the supply. Having regard to all the circumstances, and taking a commonsense and practical approach, indicators that a part may be integral, ancillary or incidental include where:

● you would reasonably conclude that it is a means of better enjoying the dominant thing supplied, rather than constituting for customers an aim in itself; or

● it represents a marginal proportion of the total value of the package compared to the dominant part; or

● it is necessary or contributes to the supply as a whole, but cannot be identified as the dominant part of the supply; or

● it contributes to the proper performance of the contract to supply the dominant part.

The three piece kit in question does not contain a dominant part and other items that are integral, incidental or ancillary to the dominant part. Each of the three items has a separate aim. The sale of the kit is a mixed supply, containing three items that each needs to be separately recognised for GST purposes.

The backrest and grab rail are GST-free.

The sign is not GST-free under subsection 38-45(1) of the GST Act. The sign will be subject to GST unless it is requested via the NDIS.

If the sign is not GST-free, GST will be payable at 1/11^th of the part of the total price for the kit that is reasonably apportionable to the sign (in accordance with paragraph 29 of GSTR 2001/8).