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Edited version of private advice
Authorisation Number: 1052135288641
Date of advice: 6 July 2023
Ruling
Subject: Supplies for consideration
Question
Do the works that will be wholly funded by Entity C on the site and owned by Entity A give rise to a taxable supply under section 9-5 of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act) by Entity C to Entity A?
Answer
No.
Relevant facts and circumstances
The entities are registered for goods and services tax (GST).
The entities entered into a Deed.
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 section 9-15
A New Tax System (Goods and services Tax) Act 1999 section 9-1
A New Tax System (Goods and Services Tax) Act 1999 section 9-40
A New Tax System (Goods and Services Tax) Act 1999 section 195-1
Reasons for decision
Section 9-40 of the GST Act provides that you are liable for GST on any taxable supplies that you make.
Section 9-5 of the GST Act states that you make a taxable supply if:
(a) you make a supply for consideration;
(b) the supply is made in the course or furtherance of an enterprise that you carry on;
(c) the supply is connected with the indirect tax zone, 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.
To be a taxable supply, all the requirements of section 9-5 of the GST Act must be satisfied.
In this case, it is necessary to firstly determine if the works are a 'supply for consideration' under paragraph 9-5(a) of the GST Act.
The Commissioner ruled that a supply was made but the supply was not for consideration. Therefore, there was no taxable supply under section 9-5 of the GST Act.
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