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Ruling

Subject: GST and education courses

Question 1

Are particular training courses, provided by you, an adult and community education (ACE) course as defined under section 195-1 of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act)?

Answer

No. The training courses provided by you are not considered ACE courses as defined under section 195-1 of the GST Act

Relevant facts and circumstances

You are not registered for GST.

You are not a registered training organisation (RTO).

You are not recognised or funded by the relevant State or Territory authority as a provider of audit and community courses

You are not a body corporate operating on a not-for-profit basis

You are not an institution that is established by a law of the Commonwealth, a State or a territory as a higher education institution or an institution registered or taken to be registered by TEQSA as a higher education provider

You are not an institution specified in section 4, or paragraph 34(4)(b), (f) or (h), of the Higher Education Funding Act 1988.

You provide the specific training courses.

You provided brochures in relation to each training course.

Each course is facilitated by you.

The certifications are globally recognised by employers.

There is no law or legal requirement that one have the qualifications one receives on successful completion of any of the course in order to enter or commence the practice of particular professions or trades.

There is no professional association that can impose a penalty on someone who enters or commences the practice of the relevant profession/s or trades without holding the relevant qualifications.

The courses are provided to all members of the general community. There are no prerequisites in which anyone must meet to enrol in our courses.

The courses are provided upon employers request for their employees on occasions.

The courses are not provided to members of an organisation or provided at the request of an organisation to members of that organisation.

The courses are not provided by way of a private tuition to an individual.

Relevant legislative provisions

A New Tax System (Goods and Services Tax) Act 1999 section 38-85

A New Tax System (Goods and Services Tax) Act 1999 section 195-1

Reasons for decision

Section 38-85 of the GST Act states that a supply is GST-free if it is a supply of an education course or administrative services directly related to the supply of such a course but only if they are supplied by the supplier of the course.

The term 'education course' is defined in section 195-1 of the GST Act to include an ACE course.

To be GST-free as an ACE course, a course must be:

· likely to add to the employment related skills of people undertaking the course; and

· of a kind determined by the Education Minister to be an adult and community education course; and

· provided by, or on behalf of, a body that is recognised or funded as a provider of ACE courses or a body corporate operating on a not-for-profit basis.

First requirement

Goods and Services Tax Ruling GSTR 2000/27 discusses the meaning of 'likely to add to employment related skills'.

Paragraph 15 of the GSTR 2000/27 states:

The test as to whether an adult and community education course is likely to add to the employment related skills of people undertaking the course is an objective test and not dependent on the subjective intention of the providers of the course or the recipients . However we consider a course satisfies the test if the course meets the following requirements:

(a)  It is directed at people who want to add to their employment related skills; and

(i) The objectives of the course specify the employment related skills that participants will acquire in undertaking the course; and

(ii) The means of imparting the skills to the participants are clearly identified prior to the commencement of the course; and

(iii) There is a reasonable expectation that the skills being developed will be used in the course of being an employee, or working in a business, occupation, profession or trade, rather than for recreational, hobby, artistic or cultural endeavours.

Based on the information that you provided, it is accepted that the training courses provided by you is likely to add to the employment related skills of the people undertaking them.

Second requirement

To satisfy the definition of an ACE course, the course must also meet the requirements of the Education Minister's Determination A New Tax System (Goods and Services Tax) (Adult and Community Education Courses) Determination 2000 (ACE Determination).

At paragraph 5(2) of the ACE Determination, the Education Minister states that an adult and community education course must:

· not be any other education course defined in section 195-1 of the Act; and

· be available to adults in the general community; and

· not be provided by or at the request of an employer to employees of that employer; and

· not be provided by or at the request of an organisation to members of that organisation, except an organisation for which membership is open to adults in the general community; and

· not be a course that is provided by way of private tuition to an individual.

Based on the information provided,

The training courses provided is not of a kind mentioned in any other paragraph of the definition of education courses in section 195-1 of the GST Act.

The courses are provided to all members of the general community. There are no prerequisites in which anyone must meet to enrol in your courses.

The courses are provided upon employers' request for their employees. However, this is only on occasions.

The courses are not provided by or at the request of an organisation to members of that organisation

The courses are not provided by way of a private tuition to an individual

Therefore, it is accepted that the training courses is a kind determined by the Education Minister to be an ACE course.

Therefore, in situations where the training courses are provided by or at the request of an employer to employees of that employer, the training courses will not be considered an ACE course. However, for all other situations, it is accepted that the training courses provided is a kind determined by the Education Minister to be an ACE course.

Third requirement

The course must be provided by, or on behalf of, a body that is recognised or funded as a provider of ACE courses or a body corporate operating on a not-for-profit basis.

You are not recognised or funded as a provider of ACE courses nor a body corporate operating on a not-for-profit basis. As such, you do not satisfy the third requirement to be considered an ACE course.

The training courses provided by you do not satisfy all the requirements to be an ACE course and therefore, not considered to be ACE courses as defined under section 195-1 of the GST Act

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