Edited version of private advice

Authorisation Number: 1052115561701

Date of advice: 5 May 2023

Ruling

Subject: GST and the supply of adjustable height tables

Question

Are adjustable height tables with customised cut outs manufactured by XXXX (You) GST-free under subsection 38-45(1) of A New Tax System (Goods and Services) Act 1999 (GST Act)?

Answer

No, the adjustable height tables with customised cut outs manufactured by You would not be GST-free under subsection 38-45(1) of the GST Act.

The scheme commences on:

5 May 20XX

Relevant facts and circumstances

XXXX (You) have an ABN and are registered for GST effective from 1 April 20XX.

You are a company that manufactures a range of adjustable height tables with customised cut-outs in the tabletops to assist wheelchair bound users with day-to-day living, inclusion and work. All the frames do the same job of getting the wheelchair user located nicely into the work area (without any bars between the legs to hamper access) at the correct table height, with a chest cut-out in the top to enable them to have their elbows or most of their forearms on the table top itself.

The tables provide better accessibility to customers who may be in a wheelchair, standing frame, or permanently bed ridden, to enable them to better access computers or other devices. They are often used for meals, various therapies, and inclusive activities with family members and friends. The tables provide a better seating position and enable easier access to people with limited mobility.

These tables are custom made by you to suit individual customers requirements.

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 schedule 3.

Reasons for decision

Section 9-5 of the GST Act provides that,

You make a taxable supply if:

•         you make the supply for consideration; and

•         the supply is made in the course or furtherance of an enterprise that you carry on; and

•         the supply is connected with the indirect tax zone; and

•         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.

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.

Item 106 in the table in Schedule 3 lists 'accessories associated with wheelchairs, motorised wheelchairs, scooters, tricycles, spinal carriages and other goods for the carriage of people with disabilities'. For a medical aid or appliance to be covered by Item 106, it does not need to be an accessory 'for' items listed, rather it only needs to be 'associated with' the items listed.

The adjustable height tables with customised cut outs however are not an accessory for the 'carriage of people with disabilities'. Instead, they would be used to provide assistance to individuals using a table more comfortably. The product would thereby not be covered under item 106 in Schedule 3 of the GST Act.

As the product does not meet the first arm of subsection 38-45(1) the Commissioner does not need to turn his mind to determine whether the remaining two arms are met. However, for the purpose of transparency, whilst the custom design of the tables would benefit those with an illness or disability, such products are already available in the market and used by individuals without an illness or disability as a more comfortable table. With the increase in popularity of adjustable height tables, it is likely that individuals without an illness or disability would consider the benefits of the customised table.

Given that the product needs to be specifically designed for people with an illness or disability and not widely used by people without an illness or disability, the product would also not satisfy the second and third limbs of the above requirements under 38-45(1) of the GST Act.

To be considered GST-free under subsection 38-45(1) of the GST Act, all of the 3 limbs must be met. The product would therefore not meet the requirements under subsection 38-45(1) of the GST Act to be considered GST-free. The supply would be considered 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).