ATO Interpretative Decision

ATO ID 2001/351

Goods and Services Tax

GST and Porcelain veneers
FOI status: may be released

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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you will need to ensure that the relevant provisions referred to in the decision have not been amended or repealed.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 dental technician, making a GST-free supply under subsection 38-45(1) of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act), when it supplies a porcelain veneer to a dentist?

Decision

No, the entity is not making GST-free supply under subsection 38-45(1) of the GST Act when it supplies a porcelain veneer to a dentist. The entity is making a taxable supply under section 9-5 of the GST Act.

Facts

The entity is a dental technician that supplies goods to dentists. The entity supplies a porcelain veneer to a dentist. A porcelain veneer is a thin skin of porcelain which is fused to teeth to improve their strength and appearance.

The entity is registered for goods and services tax (GST). The supply meets the other positive limbs of section 9-5 of the GST Act.

Reasons for Decision

Under subsection 38-45(1) of the GST Act, the supply of certain medical aids and appliances will be GST-free where the medical aid or appliance:

•: is covered by Schedule 3 to the GST Act (Schedule 3), or specified in the A New Tax System (Goods and Services Tax) Regulations 1999 (Regulations);
•: is specifically designed for people with an illness or disability; and
•: is not widely used by people without an illness or disability.

Porcelain veneers are not listed in Schedule 3 or the Regulations. Therefore, the supply of a porcelain veneer from the entity to the dentist is not GST-free under subsection 38-45(1) of the GST Act.

The entity is registered for GST and the supply meets the other positive limbs of section 9-5 of the GST Act. Furthermore the supply is neither GST-free under Division 38 of the GST Act nor input taxed under Division 40 of the GST Act. Therefore, the supply will be a taxable supply under section 9-5 of the GST Act.

[NOTE: Section 38-10 of the GST Act provides that, in certain circumstances, supplies of other health services and goods supplied during those health services are GST-free. However, in this case, section 38-10 of the GST Act does not apply to the supply made by the entity to the dentist.

Paragraph 38-10(1)(c) of the GST Act requires that the entity provides 'appropriate treatment' to the recipient of the supply. It is considered that appropriate treatment is provided when a recognised professional assesses the recipient's state of health and determines a process to pursue, in an attempt to preserve, restore or improve the physical or psychological wellbeing of that recipient insofar as that recognised professional's particular area of training allows and will include subsequent supplies for the determined process. In this case, the entity is not providing appropriate treatment to the dentist].

Date of decision: 1 June 2001

Legislative References:
A New Tax System (Goods and Services Tax) Act 1999
   section 9-5
   Division 38
   section 38-10
   paragraph 38-10(1)(c)
   subsection 38-45(1)
   Division 40
   Schedule 3

A New Tax System (Goods and Services Tax) Regulations 1999
the Regulations

Keywords
Goods and services tax
GST health
Medical aids and appliances
Taxable supply

Business Line: GST

Date of publication: 27 September 2001

ISSN: 1445-2782

history

	Date:	Version:
You are here	1 June 2001	Original statement
	24 February 2006	Archived

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