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Edited version of your private ruling

Authorisation Number: 1012449273698

Ruling

Subject: GST and education courses

Question:

Is the supply of your web-based education course a GST-free education course?

Answer:

No, the supply of your web-based education course is not a GST-free education course. The supply is a taxable supply.

Relevant facts and circumstances:

Entity A (you) is registered for the goods and services tax (GST). You are neither a Registered Training Organisation (RTO) nor recognised as a primary school, secondary school, special school or a higher education institution under a State law.

You have developed an interactive web-based educational resource (course) which you supplied directly to schools. Teachers and students at these schools will use interactive the web-based educational course.

The course is a game based on sequential learning and details of how it works are in your brochure.

You advised you do not provide professional or trade course or adult and community education (ACE) course when supplying the interactive web-based educational course.

Relevant legislative provisions:

A New Tax System (Goods and Services Tax) Act 1999 section 9-5;

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:

You are liable for GST when you make a taxable supply. You make a taxable supply under section 9-5 of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act) if:

However, the supply is not a taxable supply to the extent that it is GST-free or input taxed.

Supply of the course

From the facts given, you satisfy paragraphs 9-5(a) to 9-5(d) of the GST Act as:

However, the supply of the course is not a taxable supply to the extent that it is input taxed or GST-free.

There is no provision in the GST Act that will make the supply of the course input taxed. The next step is to determine whether the supply of the course is GST-free under section 38-85 of the GST Act since it is an online educational resource used by teachers and students at schools.

GST-free education course

The supply of an education course is GST-free under section 38-85 of the GST Act.

The term 'education course' is defined in the GST Act to include (amongst other things):

You advised that you do not provide professional or trade course or ACE course when you supply the course. Therefore, what remains is to determine whether you provide a primary or secondary course under section 38-85 of the GST Act.

Primary course

Paragraphs 19 to 22 of GSTR 2000/30 provide guidance on 'primary course' and state:

To be GST-free as a primary course, a course must be delivered in accordance with a primary curriculum recognised by the education authority in the State or Territory in which the course is delivered and by a school that is recognised as a primary school under the law of that State or Territory.

You confirmed you are not an RTO and are not recognised as a primary school under a State law. In this instance, your supply of the course does not satisfy the definition of a 'primary course' and it is not GST-free as a primary course.

Secondary course

Paragraphs 23 to 27 of GSTR 2000/30 provide guidance on 'secondary course' and state:

To be GST-free as a secondary course, a course must satisfy the Education Minister's determination under subsection 5D(1) of the Student Assistance Act 1973 (Education Minister's Determination No.2002/1).

Determination No 2002/1 provides that an accredited secondary course, conducted by a secondary school, is a secondary course.

Based on the information received, you are not an education institution as specified in the Education Minister's Determination No. 2002/1 (that is, you are not a secondary school, registered training organisation, higher education institution or a special school) .Therefore, your supply of the course does not satisfy the definition of a 'secondary course' and it is not GST-free as a secondary course.

Conclusion

Your supply of the course is not an education course within the meaning of the GST Act and is therefore not GST-free. Your supply of the course to schools is a taxable supply under section 9-5 of the GST Act and you will be liable to pay GST on the supply.

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