ATO Interpretative Decision

ATO ID 2004/853

Goods and Services Tax

GST and English language courses for people who do not have a student visa
FOI status: may be released

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Issue

Is the entity, a provider of English language courses, making a GST-free supply of an English language course for overseas students under section 38-85 of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act), when it supplies courses to students in Australia who did not enter Australia on a student visa?

Decision

No, the entity is not making a GST-free supply of an English language course for overseas students under section 38-85 of the GST Act when it supplies courses to students in Australia who did not enter Australia on a student visa.

The entity is making a taxable supply under section 9-5 of the GST Act.

Facts

The entity is an English language course provider. The entity provides English language courses that consist of classroom tuition, excursions and activities. The entity is accredited and listed on the Commonwealth Register of Institutions and Courses for Overseas Students (CRICOS).

The courses are not provided to overseas students who are in possession of a student visa, issued by the Department of Immigration Multicultural and Indigenous Affairs (DIMIA), as part of the overseas student program. The courses are provided to individuals who enter Australia on a tourist or working holiday visa who then decide to seek formal English language instruction during their stay.

The entity is registered for goods and services tax (GST). The courses are not GST-free as any other type of education course, and the supply of the courses satisfies all the positive limbs of a taxable supply under section 9-5 of the GST Act.

Reasons for Decision

The supply of an education course is GST-free under section 38-85 of the GST Act. The definition of an education course includes, amongst other things, 'an English language course for overseas students'.

An English language course for overseas students is defined in section 195-1 of the GST Act as a course of study or education supplied to overseas students that:

•: includes study or education in the English language, and
•: is supplied by an entity that is accredited to provide such courses by a State or Territory authority responsible for their accreditation.

An overseas student in this context is a student who is part of the overseas student program and is in possession of the relevant student visa, being the DIMIA visa classes 570-576. An overseas student, for the purposes of an English language course for overseas students, does not include an individual who is in Australia on a tourist visa, working holiday or other type of visa who decides to undertake some type of study or education.

The courses the entity provides are not available to overseas students as defined above. The entity only supplies these courses to individuals on tourist or working holiday visas.

As the individuals undertaking the courses are not overseas students, the entity is not making a GST-free supply of an English language course for overseas students under section 38-85 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 other provision of 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 courses to students in Australia who did not enter Australia on a student visa.

Date of decision: 7 October 2004

Legislative References:
A New Tax System (Goods and Services Tax) Act 1999
   section 9-5
   Division 38
   section 38-85
   Division 40
   section 195-1

Keywords
Goods and services tax
GST education
Education courses
English language course for overseas students
Taxable supply

Business Line: GST

Date of publication: 29 October 2004

ISSN: 1445-2782

history

	Date:	Version:
You are here	7 October 2004	Original statement
	13 September 2005	Archived

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