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Edited version of private ruling
Authorisation Number: 1011611169448
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Ruling
Subject: GST and medical aids
Question
Are you making a GST-free supply when you supply the following:
· a bed alarm
· an over door alarm
· a cushion alarm
· a break fall mat with alarm
· a break fall mat without alarm?
Yes, you are making a GST-free supply when you supply the bed alarm, over door alarm, cushion alarm and break fall mat with alarm.
No, you are not making a GST-free supply when you supply the break fall mat without alarm.
Relevant facts
You are registered for GST.
You supply the following medical aids:
A bed alarm - an infra-red detection system which attaches to the underside of the bed. It will activate the nurse call system when a patient attempts to exit the bed, thereby preventing night time wandering and injuries within a hospital/nursing home environment.
An over door alarm - an infra-red detection system which attaches above the bedroom door and interfaces via wireless technology to the nurse call system and alerts staff when a patient with dementia attempts to leave their room, thereby preventing wandering and injuries within a hospital/nursing home environment.
A wireless cushion - a pressure reduction cushion that alerts staff when a patient attempts to rise out of the chair, by activating a transmitter which sends a call via the nurse call system, thereby preventing wandering and injuries within a hospital/nursing home environment.
A break fall mat - a mat that is positioned alongside the bed at night, for patients who are at risk of falling out of bed, thereby preventing injury to the patient.
A break fall mat with alarm has the additional feature of a transmitter, which will activate the nurse call system, thereby alerting staff that a patient requires assistance.
The above medical aids are made specifically for nursing homes and hospitals for use by people with a disability or illness, for example, those with mental or physical difficulties or who are frail due to old age.
The above medical aids provide no benefits for people who do not have a disability or illness.
There is no agreement between you and any recipients of the supply that the supply of the above medical aids will not be treated as a GST-free supply.
Reasons for decision
Under subsection 38-45(1) of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act), the supply of a medical aid or appliance is GST-free where the medical aid or appliance:
· is covered by Schedule 3, or specified in the A New Tax System (Goods and Services Tax) Regulations 1999 (GST Regulations), and
· is specifically designed for people with an illness or disability, and
· is not widely used by people without an illness or disability.
Item 33 in the table in Schedule 3 (Item 33) lists 'medical alert devices'. It is considered that a 'medical alert device' is a device that is designed for the purpose of alerting medical/caring personnel or an ambulance service to the fact that a person is in need of emergency medical assistance or that the person has a medical condition that may require specific treatment.
In your case, the bed alarm, over door alarm, cushion alarm and break fall mat with alarm are designed for the purpose of alerting nursing personnel to the fact that a patient with a medical condition (with resultant physical or mental difficulties) needs immediate assistance. Therefore, they fall within the meaning of Item 33. Furthermore, these medical aids are designed for people with an illness or disability and are not widely used by people without an illness or disability.
Therefore, you are making a GST-free supply under subsection 38-45(1) of the GST Act when you supply the bed alarm, over door alarm, cushion alarm and break fall mat with alarm.
The break fall mat without alarm is designed for the purpose of preventing injury to the patient at risk of falling out of bed by breaking their fall with a mattress. This product does not fit within any of the items specified in either Schedule 3 or the GST Regulations. Therefore, it does not satisfy the requirements of a GST-free medical aid or appliance under subsection 38-45(1) of the GST Act. The supply of the break fall mat without alarm is not GST-free under any other provisions of the GST Act. Consequently, you are making a taxable supply under section 9-5 of the GST Act when you supply the break fall mat without alarm.
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