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This edited version has been archived due to the length of time since original publication. It should not be regarded as indicative of the ATO's current views. The law may have changed since original publication, and views in the edited version may also be affected by subsequent precedents and new approaches to the application of the law.

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Edited version of your private ruling

Authorisation Number: 1012463837725

Ruling

Subject: GST and commission

Question

Are you liable to pay goods and services tax (GST) on the commission you receive from an Australian supplier?

Advice

Yes, you are liable to pay GST on the commission you receive from an Australian supplier as the commission is consideration for a taxable supply you have made under section 9-5 of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act).

Relevant facts

You carry on a commission agent business activity in Australia which involves negotiating Agreements in regard to goods that will be exported overseas in return for a commission payment.

You have provided us with a copy of an Agreement which you have with an Australian supplier. As per Agreement the Australian supplier pays you a commission for negotiating sales agreement with an overseas company.

You are registered for GST.

Relevant legislative provisions

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

Reason for decision

GST is payable on a taxable supply. A supply is a taxable supply under section 9-5 of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act) if an entity:

From the information received you satisfy paragraphs 9-5(a) to 9-5(d) of the GST Act as:

However, your supply to the Australian supplier is not a taxable supply to the extent it is GST-free or input taxed. There is no provision under the GST Act that will make your supply to the Australian supplier GST-free or input taxed.

Your supply is therefore a taxable supply under section 9-5 of the GST Act and you are liable to pay GST on the commission which is consideration for your taxable supply.


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