ATO Interpretative Decision
ATO ID 2001/386
Goods and Services Tax
GST and wheelchair cushionsFOI status: may be released
This ATOID provides you with the following level of protection:
If you reasonably apply this decision in good faith to your own circumstances (which are not materially different from those described in the decision), and the decision is later found to be incorrect you will not be liable to pay any penalty or interest. However, you will be required to pay any underpaid tax (or repay any over-claimed credit, grant or benefit), provided the time limits under the law allow it. If you do intend to apply this decision to your own circumstances, you will need to ensure that the relevant provisions referred to in the decision have not been amended or repealed. You may wish to obtain further advice from the Tax Office or from a professional adviser.
Issue
Is the entity, a supplier of wheelchair accessories, making a GST-free supply under subsection 38-45(1) of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act), when it supplies a wheelchair cushion?
Decision
Yes, the entity is making a GST-free supply under subsection 38-45(1) of the GST Act when it supplies a wheelchair cushion.
Facts
The entity is a supplier of wheelchair accessories. The entity supplies a product that is marketed as a wheelchair cushion.
The wheelchair cushion is shock absorbent and therefore, prevents back injury due to excessive jolting and jarring for people confined to wheelchairs or for people who need to use scooters to aid their mobility.
There is no agreement between the entity and the recipient that the supply will not be treated as a GST-free supply.
The entity is registered for goods and services tax (GST).
Reasons for Decision
Under subsection 38-45(1) of the GST Act, the supply of certain medical aids and appliances is GST-free where the medical aid or appliance:
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- 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(Regulations);
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- is specifically designed for people with an illness or disability; and
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- is not widely used by people without an illness or disability.
Item 106 in the table in Schedule 3 (Item 106) lists 'accessories associated with wheelchairs, motorised wheelchairs, scooters, tricycles, spinal carriages and other goods for the carriage of people with disabilities'.
In this case, the wheelchair cushion is shock absorbent to prevent back injury for people confined to wheelchairs or for people who need to use scooters to aid their mobility. Therefore, it is considered that the wheelchair cushion is an accessory associated with wheelchairs and scooters and therefore, comes within the scope of Item 106.
Furthermore, as the wheelchair cushion is designed to assist people using wheelchairs or scooters, it is considered that the wheelchair cushion is specifically designed for people with an illness or disability and not widely used by people without an illness or disability. Accordingly, the supply of the wheelchair cushion satisfies the requirements in subsection 38-45(1) of the GST Act.
Therefore, the entity is making a GST-free supply under subsection 38-45(1) of the GST Act when it supplies a wheelchair cushion.
Amendment History
| Date of Amendment | Part | Comment |
|---|---|---|
| 9 April 2019 | Throughout | Updated A New Tax System (Goods and Services Tax) Regulations 1999 to A New Tax System (Goods and Services Tax) Regulations 2019. |
Legislative References:
A New Tax System (Goods and Services Tax) Act 1999
subsection 38-45(1)
Schedule 3
Schedule 3 table item 106
The Regulations
Keywords
Goods and services tax
GST free
GST health
Medical aids & appliances
ISSN: 1445-2782