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Edited version of your written advice
Authorisation Number: 1012699743258
Ruling
Subject: Goods and Services Tax (GST) Supplies
Overview
Shared storage arrangements where stock is managed by the storage facility operator via formal arrangements. Broadly, where a storage facility operator (including third parties) has excess capacity at a storage facility, the storage facility operator may make this capacity available to a third party under the conditions and charges outlined in a formal agreement.
The provision of the storage facility to a third party for the charges outlined in the agreement is a taxable supply under section 9-5 of A New Tax System (Goods and Services Tax) Act 1999 (GST Act). However the movement of stock into and out of the storage facility is not a separate taxable supply unless the title of the stock changes and there is separate consideration provided.
Where these arrangements are made through a joint venture between the parties the provision of the storage facility will not be treated as a taxable supply provided the requirements of subsection 51-30(2) of the GST Act are met.
Where excess stock is moved out of the storage facility by the third party and under the agreement is required to provide additional consideration for this stock then a taxable supply is made by the storage facility operator to the third party. However there will be no supply if the agreement allows the third party to replenish the excess stock into the storage facility at a later time.
Relevant legislative provisions
A New Tax System (Goods & Services Tax) Act 1999 Section 9-5
A New Tax System (Goods & Services Tax) Act 1999 Section 51-30
A New Tax System (Goods & Services Tax) Act 1999 Division 29
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