ATO Interpretative Decision
ATO ID 2004/963 (Withdrawn)
Goods and services tax
GST and composite supplies of education coursesFOI status: may be released
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This ATO ID is withdrawn on the basis that a precedential view exists. The ATO view for this issue is covered in Goods and Services Tax Ruling GSTR 2001/8This document incorporates revisions made since original publication. View its history and amending notices, if applicable.
Status of this decision: Decision Withdrawn 17 February 2006
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you will need to ensure that the relevant provisions referred to in the decision have not been amended or repealed.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 registered training organisation, making a GST-free supply under section 38-85 of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act), when it provides an accredited training course that is interspersed with training information from an unaccredited course?
Decision
Yes, the entity is making a GST-free supply under section 38-85 of the GST Act when it provides an accredited training course that is interspersed with training information from an unaccredited course.
Facts
The entity is a registered training organisation that is registered for goods and services tax (GST).
The entity is accredited to provide an accredited vocational education and training course from an accredited national training package. This accredited course is a tertiary course as defined in section 195-1 of the GST Act.
The entity provides this accredited course interspersed with training information from a separate unaccredited course. The unaccredited course is not a tertiary course, or any other type of education course, as defined in section 195-1 of the GST Act.
The information from the unaccredited course is specific to the State in which the accredited course is provided and is included to contribute to and complement the information in the accredited course. The information is not presented in such a way that it could be identified as a separate unit (subject) of the course.
Reasons for Decision
Under section 38-85 of the GST Act, a supply of an education course is GST-free. 'Education course' is defined in section 195-1 of the GST Act to include a tertiary course.
The accredited portion of the entity's course is a tertiary course. However, the interspersed unaccredited portion is not a training course or any other type of education course. Therefore, it needs to be determined whether the supply of the entity's course is entirely GST-free as an education course or whether only the accredited part of the course is GST-free.
Goods and Services Tax Ruling GSTR 2001/8 explains how to identify whether a supply includes taxable and non-taxable parts. A supply can either be:
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- a mixed supply (a supply containing separately identifiable taxable and non-taxable parts), or
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- a composite supply (a supply that appears to have separately identifiable parts but is essentially a supply of one thing).
Paragraph 17 of GSTR 2001/8 provides:
If you made a supply that contains a dominant part and the supply includes something that is integral, ancillary or incidental to that part, then the supply is composite. You treat a composite supply as a supply of a single thing. ...
Further, paragraph 59 of GSTR 2001/8 provides:
...That is, we consider that a part of a supply will be integral, ancillary or incidental where it is insignificant in value or function, or merely contributes to or complements the use or enjoyment of the dominant part of the supply. ...
The information from the unaccredited course is specific to the State in which the accredited course is provided and is included to contribute to and complement the information in the accredited course. The information is not presented in such a way that it could be identified as a separate unit (subject) of the course. The accredited part of the course that the entity supplies is the dominant part of the supply.
Therefore, the unaccredited portion of the course forms a minor part of the course that contributes to and complements the dominant part of the course. As the unaccredited portion is integral, ancillary and incidental to the dominant accredited unit, the entity is making a single composite supply. This single supply is a supply of a tertiary course as defined in section 195-1 of the GST Act.
The entity is supplying an education course that is GST-free under section 38-85 of the GST Act when it provides an accredited training course that is interspersed with training information from an unaccredited course.
Legislative References:
A New Tax System (Goods and Services Tax) Act 1999
section 9-5
section 38-85
section 195-1
Related Public Rulings (including Determinations)
GSTR 2001/8
Keywords
Goods and services tax
GST free
GST education
Education courses
ISSN: 1445-2782
| Date: | Version: | |
| 20 November 2001 | Original statement | |
| You are here → | 17 February 2006 | Archived |
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