Disclaimer
This edited version has been archived due to the length of time since original publication.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.

You cannot rely on this record in your tax affairs. It is not binding and provides you with no protection (including from any underpaid tax, penalty or interest). In addition, this record is not an authority for the purposes of establishing a reasonably arguable position for you to apply to your own circumstances. For more information on the status of edited versions of private advice and reasons we publish them, see PS LA 2008/4.

Edited version of private advice

Authorisation Number: 1051572343899

Date of advice: 10 September 2019

Ruling

Subject: GST and medical aids and appliances

Question

Are your supplies of the listed items GST-free under subsections 38-45(1) or 38-47(1) of the A New System (Goods and Services Tax) Act 1999 (GST Act)?

Answer

No, your supplies of the listed items are not GST-free under subsections 38-45(1) or 38-47(1) of the GST Act. The supply of your listed items is a taxable supply.

Relevant facts and circumstances

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

·        You supply items that are not designed to be worn by those without an illness or disability.

Relevant legislative provisions

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 38-47(1)

Reasons for decision

Subsection 38-45(1)

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

·        covered by Schedule 3 to the GST Act (Schedule 3), or specified in the A New Tax System (Goods and Services Tax) Regulations 2019 (GST Regulations)

·        is specifically designed for people with an illness or disability, and

·        is not widely used by people without an illness or disability.

All the above elements must be satisfied for an item to be GST-free under subsection 38-45(1) of the GST Act.

There are no items in Schedule 3 that specifically cover any of the items listed. The closest item of relevance is Item 18 in Schedule 3 (Item 18) which lists 'disposable/reusable continence pads, pants and nappies required for continence use (excluding nappies for babies, sanitary pads or tampons)'

Subsection 38-47(1)

Under subsection 38-47(1) of the GST Act a supply of health goods is GST-free if it is a supply of goods of a kind that the Health Minister, by determination in writing, declares to be goods the supply of which is GST-free.

There are no goods of a kind listed within any determination that would make the listed items you supply GST-free under subsection 38-47 of the GST Act.

Summary

It is accepted that the listed items you supply are designed for people with an illness or disability and is not widely used by people without an illness or disability. However to be GST-free under subsection 38-45(1) of the GST Act the listed items must also be covered by Schedule 3 or specified in the GST Regulations. As such, the supply of the listed items is a taxable supply under section 9-5 of the GST Act.

Copyright notice

© Australian Taxation Office for the Commonwealth of Australia

You are free to copy, adapt, modify, transmit and distribute material on this website as you wish (but not in any way that suggests the ATO or the Commonwealth endorses you or any of your services or products).