A New Tax System (Goods and Services Tax) Regulations 2019

Chapter 4 - The special rules  

Part 4-1 - Special rules mainly about particular ways entities are organised  

Division 48 - GST groups  

Subdivision 48-A - Formation and membership of GST groups  

SECTION 48-10.02   Membership requirements for partnerships  

(1)    
For the purposes of subparagraph 48-10(1)(a)(ii) of the Act, this section sets out the requirements that a partnership must satisfy.

Note:

The partnership must also satisfy other membership requirements set out in section 48-10 of the Act.

(2)    
If the GST group or proposed GST group includes entities other than partnerships, the partnership must satisfy the requirements of subsection (4), (5), (6) or (7).

(3)    
If the GST group or proposed GST group consists only of partnerships:

(a) there are no further requirements for one of the partnerships; and

(b) each other partnership must satisfy the requirements of subsection (7).

Requirements that may be satisfied

(4)    
The partnership satisfies the requirements of this subsection if, for at least one company that is a member of the GST group or proposed GST group:

(a) the partnership has at least a 90% stake in the company (worked out in accordance with section 190-5 of the Act as if the partnership were a company); or

(b) shares of the company are held in such a way that:

(i) if there is one shareholder - the shareholder is an associated person in relation to a partner in the partnership; and

(ii) if there is more than one shareholder - at least 2 shareholders are associated persons in relation to different partners in the partnership.

(5)    
The partnership satisfies the requirements of this subsection if each partner in the partnership is:

(a) an individual who is a member of the GST group or proposed GST group; or

(b) a family member of such an individual.

(6)    
The partnership satisfies the requirements of this subsection if, for at least one trust that is a member of the GST group or proposed GST group, the beneficiaries include at least 2 persons who are associated persons in relation to different partners in the partnership.

(7)    
The partnership (the candidate partnership ) satisfies the requirements of this subsection if:

(a) there is a partnership (the member partnership ) that is a member of the GST group or proposed GST group because of:

(i) paragraph (3)(a) or subsection (4), (5) or (6); or

(ii) this subsection, including the repeated application of this subsection; and

(b) each partner in the candidate partnership is an individual, a family trust of an individual or a family company of an individual; and

(c) for each partner in the candidate partnership that is an individual, a family trust of an individual or a family company of an individual, one of the following is a partner in the member partnership:

(i) the individual;

(ii) a family trust of the individual;

(iii) a family company of the individual;

(iv) a family member of the individual;

(v) another individual for whom the first individual is a family member;

(vi) a family trust of a family member mentioned in subparagraph (iv) or the other individual mentioned in subparagraph (v);

(vii) a family company of a family member mentioned in subparagraph (iv) or the other individual mentioned in subparagraph (v); and

(d) at least 2 of the partners in the candidate partnership comply with paragraph (c) through different partners in the member partnership (whether or not they also comply through the same partner in the member partnership).