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Edited version of private advice

Authorisation Number: 1012617876238

Ruling

Subject: GST and medical aids and appliances

Questions

Answers

Relevant facts and circumstances

You are registered for goods and services tax (GST).

You supply products used by health care professionals to provide both types of cardiac resuscitation (pacing and defibrillation) inside and outside the hospital.

Your products include cardiac monitors designed for monitoring and defibrillating patients with suspected cardiac arrhythmia. In the event of a cardiac arrest, the products can deliver a defibrillation shock to recalibrate the heart and resume normal rhythm.

You also supply spare parts that are specifically designed as spare parts of the products and are necessary in order for the products to be in working condition

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 38-45(1),

A New Tax System (Goods and Services Tax) Act 1999 subsection 38-45(2) and

A New Tax System (Goods and Services Tax) Act 1999 subsection 38-45(3).

Reasons for decisions

1. Under subsection 38-45(1) of the GST Act, a supply of a medical aid or appliance is GST-free if the medical aid or appliance:

Paragraph 38-45(1)(a) - covered by Schedule 3

The supply of the products is GST-free under subsection 38-45(1) of the GST Act.

2. Subsection 38-45(2) of the GST Act provides that the supply of a spare part that is specifically designed as a spare part for another thing that is GST-free under subsection 38-45(1) is also GST-free. A supply of generic spare part which may be used for an item that is GST-free under 38-45(1) will not be GST-free.

Supplies not treated as GST-free

According to subsection 38-45(3) of the GST Act, a supply is not GST-free under subsection 38-45(1) or 38-45(2) if the supplier and the recipient have agreed that the supply, or supplies that include that supply, not be treated as GST-free.


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