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Edited version of your private ruling
Authorisation Number: 1012561330752
Ruling
Subject: GST and education course
Question
Are you making a GST-free supply of an adult and community education (ACE) course when you supply the Course?
Answer
No.
Relevant facts and circumstances
You began teaching the Course through your teaching facility. This is a new field where there are no previous teaching facilities or associations set up.
You are not a registered training organisation (RTO) and the Course is not funded by the government. You have several students who are receiving government financial assistance via their job network provider.
Your students are mainly those who are already in the industry, who want to add to their skills. The Course is also available to those people who have a special interest in that field.
The Course is advertised through your website. The Course information is also available on your Facebook page.
Your website provides certain following information about the Course:
· X year diploma
· This X module (Y lessons each module) course is very suitable for certain people, and those already working in this field.
· Courses are online and by DVD: 1 module fortnightly (one theory, one practical) with questions for reply.
· Regular free Skype conference sessions replace the old ideal of the 'block' practical attendance on campus.
· Course is project based rather than exam based.
· Minimum requirements: particular experience.
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 Subsection 38-85.
A New Tax System (Goods and Services Tax) Act 1999 Section 195-1.
Reasons for decision
GST is payable on the supply of an course if you are making a taxable supply.
Section 9-5 of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act) states:
You make a taxable supply if:
(a) you make the supply for *consideration, and
(b) the supply is made in the course or furtherance of an *enterprise that*you carry on; and
(c) the supply is *connected with Australia; and
(d) you are *registered, or *required to be registered.
However, the supply is not a *taxable supply to the extent that it is *GST-free or *input taxed.
(* denotes a term in section 195-1 of the GST Act.)
Based on the information that you have provided, the supply of the Course is for consideration, the supply is made in the course or furtherance of your enterprise, the supply is connected with Australia and you are registered for GST. Hence, the requirements of paragraphs 9-5(a), 9-5(b), 9 5(c) and 9-5(d) of the GST Act are satisfied.
The supply of the Course is not input taxed. It remains to be determined whether the supply is GST-free.
Section 38-85 of the GST Act provides that a supply of an education course is GST-free.
The definition of an education course includes 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
· be of a kind determined by the Education Minister to be an ACE course, and
· 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 non-profit basis that has not been refused recognition or disqualified by a State or Territory authority as a provider of ACE courses for failing to meet or maintain the standards required by that authority.
First requirement
Goods and Services Tax Ruling GSTR 2000/27 discusses the meaning of likely to add to the employment related skills. Paragraph 17 of this ruling sets out that a course will add to the employment related skills if the intended outcome of the course is to develop, increase, advance or improve the employment related skills of the people undertaking the course. Based on the information you provided, the Course is tailored for certain people or to those people who have a special interest in that field who want to increase or advance their employment related skills. Therefore the Course satisfies the first requirement.
Second requirement
To satisfy the definition of ACE course the course must also meet the requirements of the Education Minister's Determination, the A New Tax System (Goods and Services Tax) (Adult and Community Education Courses) Determination 2000. At paragraph 5(2) of the determination, the Education Minister states that an ACE course must:
(a) not be any other education course defined in section 195-1 of the GST Act
(b) be available to adults in the general community
(c) not be provided by or at the request of an employer to employees of that employer
(d) 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
(e) not be a course that is provided by way of private tuition to an individual.
On the information provided, the Course does not satisfy the definition of any other education course. The Course is not delivered at the instigation of employers to their employees or organisations to their members. The course is not presented by way of private tuition to individuals.
Therefore, it is necessary to determine if the Course is available to adults in the general community.
A course is not 'available to adults in the general community' if the course outline states that a qualification and/or experience in a particular trade, profession or field is a pre-requisite for enrolment.
The information on your website indicates that it is a requirement that applicants have a minimum level of work or other relevant experience. It is accordingly not available to adults in the general community.
As a consequence, the Course does not satisfy the second requirement of an ACE course.
Even if the Course satisfied the second requirement, it must still satisfy the third requirement to be considered an ACE course.
Third requirement
To be an ACE course, the courses must be provided by, or on behalf of, a body that is a higher education institution, recognised or funded as a provider of ACE courses or a body corporate operating on a non-profit basis that has not been refused recognition or disqualified by a State or Territory authority as a provider of ACE courses for failing to meet or maintain the standards required by that authority.
Based on the information provided, you are neither of those bodies listed. Hence, you do not satisfy the third requirement.
As the Course does not satisfy all the requirements of the definition of an ACE course, it is not GST-free as an ACE course.
The supply of the Course is not a GST-free supply of any other education course. In addition, the supply of the Course is not GST-free under any other provision of the GST Act or any other Act.
Therefore, as the supply of the Course meets all the requirements of section 9-5 of the GST Act, the supply of the Course is a taxable supply and GST is payable on its supply.
Any fee that you charge for the Course is subject to GST.
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