ATO Interpretative Decision

ATO ID 2001/103 (Withdrawn)

Goods and Services Tax

GST and Prize money - Show Organiser's Perspective
FOI status: may be released

The ATO view for this issue is covered in Goods and Services Tax Ruling GSTR 2002/3 (in particular paragraphs 55-72).

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you will need to ensure that the relevant provisions referred to in the decision have not been amended or repealed.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 the entity, an agricultural show competition organiser, making a creditable acquisition under section 11-5 of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act) when it pays prize money to the winner of a competition?

Decision

Yes, the entity is making a creditable acquisition under section 11-5 of the GST Act.

Facts

The entity is registered for goods and services tax (GST) and organises competitions in Australia for the exhibition of animals or produce. It receives an entry fee from each participant that enters the competition and provides a monetary prize to the winner of the competition.

The prizewinner makes a taxable supply under section 9-5 of the GST Act where it receives prize money for the exhibition of the animal or produce.

Reasons For Decision

The general requirements that must be met for an entity to make a creditable acquisition is set out in section 11-5 of the GST Act as follows:

You make a creditable acquisition if:

(a): you acquire anything solely or partly for a creditable purpose; and
(b): the supply of the thing to you is a taxable supply; and
(c): you provide or are liable to provide consideration for the supply; and
(d): you are registered, or required to be registered for GST.

The entity is acquiring a supply of services from the prizewinner in carrying on its enterprise. The supply by the prizewinner is a taxable supply for which the prizemoney is consideration provided by the entity.

Therefore, the entity is making a creditable acquisition as all of the requirements in section 11-5 of the GST Act are met.

[NOTE: A monetary prize, as discussed above, is consideration for a service provided by the prizewinner as a consequence of being a participant in the competition. In itself, the supply of the monetary prize cannot be a supply by the show organiser as subsection 9-10(4) of the GST Act specifically states that a supply does not include a supply of money unless the money is provided as consideration for a supply that is a supply of money.]

Date of decision: 26 September 2000

Legislative References:
A New Tax System (Goods and Services Tax) Act 1999
   section 9-5
   subsection 9-10(4)
   section 11-5

Related ATO Interpretative Decisions
ATO ID 2001/104 ATO ID 2001/105

Other References:
GST Primary Production-Newsletter No.5 - 04 July 2000

Keywords
Goods and Services Tax
GST primary production
GST consideration
Creditable acquisition
Creditable purpose
Taxable supply

Business Line: GST

Date of publication: 12 July 2001

ISSN: 1445-2782

history

	Date:	Version:
	26 September 2000	Original statement
You are here	18 November 2005	Archived

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