ATO Interpretative Decision

ATO ID 2001/783 (Withdrawn)

Goods and Services Tax

GST and supply of a car part to a business entity that on sells the car part to a disabled veteran
FOI status: may be released

This ATO ID is withdrawn as it is superseded by the 'GST and cars purchased by eligible people with disabilities' fact sheet (NAT 4325).

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you will need to ensure that the relevant provisions referred to in the decision have not been amended or repealed.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, a manufacturer of car parts, making a GST-free supply under subsection 38-505(4) of the A New Tax System (Goods & Services Tax) Act 1999 (GST Act), when it sells a car part to a business entity that on sells the car part to a disabled veteran?

Decision

No, the entity is not making a GST-free supply under subsection 38-505(4) of the GST Act when it sells a car part to a business entity that on sells the car part to a disabled veteran. The entity is making a taxable supply under section 9-5 of the GST Act.

Facts

The entity is a manufacturer of car parts.

The entity is registered for GST. The supply satisfies the other positive limbs of section 9-5 of the GST Act.

The entity sells a car part to a business entity that on sells the car part to an individual.

The individual is a disabled veteran who satisfies the requirements of subsection 38-505(1) of the GST Act.

Reasons for Decision

Under Subdivision 38-P of the GST Act, a supply of car parts to a disabled veteran may be GST-free. Subsection 38-505(4) of the GST Act sets out the requirements for a supply of car parts that are for a car for a disabled veteran to be GST-free.

Under subsection 38-505(4) of the GST Act, the supply of the car parts must be made to an individual who is a disabled veteran who meets the requirements of subsection 38-505(1) of the GST Act.

In this case, the supply is to a business entity, rather than to an individual who meets the requirements of subsection 38-505(1) of the GST Act. Therefore, the entity is not making a GST-free supply of car parts under subsection 38-505(4) of the GST Act.

The entity is registered for GST and the supply satisfies 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 entity is making a taxable supply under section 9-5 of the GST Act when it sells a car part for a car to a business entity that on sells the car part to a disabled veteran.

Date of decision: 19 September 2001

Legislative References:
A New Tax System (Goods and Services Tax) Act 1999
   section 9-5
   Division 38
   Subdivision 38-P
   subsection 38-505(1)
   subsection 38-505(4)
   Division 40

Related ATO Interpretative Decisions
ATO ID 2001/784
ATO ID 2001/785
ATO ID 2001/786

Other References:
Motor Vehicles Issues Register -Issue #2
Cars & the GST - purchase by eligible people with disabilities - (Nat 4325)

Keywords
Goods and services tax
GST free
Cars for disabled veterans
Taxable supply

Business Line: GST

Date of publication: 21 December 2001

ISSN: 1445-2782

history

	Date:	Version:
	19 September 2001	Original statement
You are here	24 November 2006	Archived

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