ATO Interpretative Decision
ATO ID 2004/438
Goods and Services Tax
GST and supply of a religious pastoral ministry courseFOI status: may be released
Status of this decision: Decision Current
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you will need to ensure that the relevant provisions referred to in the decision have not been amended or repealed.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 religious institution, making a GST-free supply under section 38-220 of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act), when it supplies a course in religious pastoral ministry?
Decision
No, the entity is not making a GST-free supply under section 38-220 of the GST Act when it supplies a course in religious pastoral ministry. The supply of the religious pastoral ministry course is a taxable supply under section 9-5 of the GST Act.
Facts
The entity is a religious institution. The entity supplies a course in religious pastoral ministry. The course is essential for someone wishing to become a chaplain at a religious institution. Completion of the course will entitle the student to a credit in theology studies at tertiary level.
The supply of the course is not a GST-free supply of an education course under Subdivision 38-C of the GST Act.
The entity is registered for goods and services tax (GST) and the supply satisfies the other positive limbs of section 9-5 of the GST Act.
Reasons for Decision
Under section 38-220 of the GST Act, a supply is GST-free if it is a supply of service that:
- •
- is supplied by a religious institution, and
- •
- is integral to the practice of that religion.
The entity is a religious institution and therefore satisfies the first requirement. To satisfy the second requirement, a service must be integral to the practice of that religion. Examples of these services include religious services provided at ceremonies such as weddings, baptisms or funerals that are conducted in accordance with the canons of conduct for the members of that religious institution.
The training of a student is not the supply of a religious service that is integral to the practice of that religion. Accordingly, the entity's supply does not meet all of the requirements of section 38-220 of the GST Act and the entity is not making a GST-free supply when it supplies a course in religious pastoral ministry.
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 any other provision in 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 supplies a course in religious pastoral ministry.
Date of decision: 20 July 2001
Legislative References:
A New Tax System (Goods and Services Tax) Act 1999
section 9-5
section 38-220
Division 38
Subdivision 38-C
Division 40
Keywords
Goods and services tax
GST non profit
GST religious services
GST supplies & acquisitions
Taxable supply
ISSN: 1445-2782
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