ATO Interpretative Decision
ATO ID 2001/108
Goods and Services Tax
GST and Assessment of overseas-trained professionalsFOI status: may be released
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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you will need to ensure that the relevant provisions referred to in the decision have not been amended or repealed.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 professional 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 assesses the overseas qualifications of overseas-trained professionals?
Decision
Yes, the entity is making a GST-free supply under section 38-110 of the GST Act when it assesses the overseas qualifications of overseas-trained professionals.
Facts
The entity, which is registered for GST, is a professional association charged with the responsibility of accrediting schools, courses and schools of training (within Australia) leading to professional qualifications. The entity's members are regional professional bodies from various States and Territories.
In Australia, separate laws in each State or Territory regulate the registration requirements for this profession. In each State or Territory, either the regional bodies or branches of government administer the registration requirements.
In order for overseas-trained professionals to be able to be register in Australia, they must have their competency accepted by the National Office of Overseas Skills Recognition (NOOSR). NOOSR has empowered the entity to assess the educational qualifications and work experience of the overseas-trained professionals. The overseas-trained professionals must sit both a written and practical examination to evaluate their competencies. The entity charges the overseas-trained professionals a fee for this assessment. The assessment allows the overseas-trained professionals to undertake the profession in Australia.
The entity is registered for goods and services tax (GST). The supply satisfies the other positive limbs of section 9-5 of the GST Act.
Reasons For Decision
According to subsection 38-110(1) of the GST Act, a supply is GST-free if the supply is the assessment or issue of qualifications for the purpose of:
- (a)
- access to education; or
- (b)
- membership of a professional or trade association; or
- (c)
- registration or licensing for a particular occupation; or
- (d)
- employment.
In this case, the entity provides both a written and practical examinations to evaluate the overseas-trained professionals competencies to determine whether they can be registered and undertake the profession in Australia. Therefore, the supply of these examinations by the entity is an assessment or issue of qualifications for the purpose of either or licensing for a particular occupation registration (paragraph 38-110(1)(c) of the GST Act) or employment registration (paragraph 38-110(1)(d) of the GST Act).
Under subsection 38-110(2) of the GST Act, a supply will not be GST-free unless the supply is carried out by a professional or trade association.
In this case, the supply does satisfy the provisions of this subsection as the examination is carried out by the entity, which is a professional association.
Therefore, the entity is making a GST-free supply under section 38-110 of the GST Act when it assesses the overseas qualifications of overseas-trained professionals.
Date of decision: 4 April 2001
Legislative References:
A New Tax System (Goods and Services Tax) Act 1999
section 38-110
subsection 38-110(1)
paragraph 38-110(1)(c)
paragraph 38-110(1)(d)
subsection 38-110(2)
ATO ID 2001/106 ATO ID 2001/107
Keywords
Goods & services tax
GST education
Prior learning
GST supply
Taxable supply
ISSN: 1445-2782
| Date: | Version: | |
| You are here | 4 April 2001 | Original statement |
| 23 December 2005 | Archived |
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