Edited version of private ruling

Authorisation Number: 1011744131607

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Ruling

Subject: GST and supply of training courses

Question

1. Is your supply of the training courses a taxable supply?

2. Is your supply of assessment a taxable supply?

3. Is your supply of training materials a taxable supply?

Answers

1. No, your supply of the training courses is a GST-free supply.

2. No, your supply of assessment is a GST-free supply.

3. No, your supply of training materials is a GST-free supply

Relevant facts and circumstances

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

You are an accredited trainer and assessor with the relevant training recognition authority. You are not a registered training organisation (RTO).

You train and assess individuals who wish to obtain certification to operate heavy machineries.

The courses lead to qualifications that are imposed under an Australian law.

All persons wishing to operate or carry out high risk works must hold the qualifications.

At the conclusion of the training and assessment, a successful person's documentation is forwarded to an RTO who will issue a document required by the person to obtain certification from the relevant authority.

Separate fees are charged for the training courses, training materials and assessment.

On occasions, an RTO would ask you to deliver the courses and/or conduct assessments on its behalf.

You are not recognised by a State or Territory authority as a provider of adult and community education (ACE) course.

You are not funded by a State or Territory on the basis that you are a provider of an ACE course.

You also supply the courses:

· to employees at the request of their employers,

· to members of an organisation at the request of that organisation,

· by way of private tuition to an individual.

The courses are available to the adult community at large.

Reasons for decisions

Question 1

According to section 9-5 of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act), you make a taxable supply if:

(a) you make the supply for consideration; and

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

(c) the supply is connected with Australia; 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.

You make the supply of the training courses for consideration and in the course of the enterprise that you carry on. The supply is connected with Australia as the courses are provided in Australia. You are registered for GST. As such, the requirements in paragraphs

9-5(a) to 9-5(d) of the GST Act are satisfied.

There are no provisions in the GST Act under which your supply of the training courses is input taxed. Therefore, what remains to be determined is whether your supply of the training courses is GST-free.

Paragraph 38-85(a) of the GST Act provides that a supply is GST-free if it is a supply of an education course.

Education course is defined in section 195-1 of the GST Act to include professional or trade courses.

Section 195-1 of the GST Act defines a professional or trade course. It states:

professional or trade course means a course leading to a qualification that is an *essential prerequisite:

(a) for entry to a particular profession or trade in Australia; or

(b) to commence the practice of (but not to maintain the practice of) a profession or trade in Australia.

In accordance with the definition 'essential prerequisite' under section 195-1 of the GST Act, a qualification is an essential prerequisite in relation to the entry to, or the commencement of the practice of, a particular profession or trade if the qualification is imposed:

(a) by or under an industrial instrument; or

(b) if there is no industrial instrument for that profession or trade but there is a professional or trade association that has uniform national requirements relating to the entry to, or the commencement of the practice of, the profession or trade concerned by that association; or

(c) if neither paragraph (a) or (b) applies but there is a professional or trade association in a State or Territory that has requirements relating to the entry to, or the commencement of the practice of, the profession or trade concerned by that association.

An industrial instrument includes an Australian law. An Australian law includes a State law.

You advised that the training courses lead to qualifications that are imposed under an Australian law. The certification is required for individuals to operate heavy machineries. As such, the training courses are professional or trade courses. Accordingly, your supply of the training courses is GST-free.

Where you deliver the training courses at the request of an employer for its employees or of an organisation for its members, we consider that you are supplying the training courses. Therefore the supply of the training courses is GST-free under these circumstances.

However, where students enrol with and pays an RTO for the training courses; and the RTO asks you to deliver the courses on its behalf, you do not supply the courses. Under these circumstances, you are making a supply of service to the RTO in delivering the training courses. Accordingly, the supply of your service would not be a GST-free supply of education course.

Question 2

Under section 38-110 of the GST Act, a supply is GST-free if the supply is the assessment or issue of qualifications for the purpose of:

· access to education; or

· membership of a professional or trade association; or

· registration or licensing for a particular occupation; or

· employment.

However, the supply is not GST-free unless the supply is carried out by:

· a professional or trade association; or

· an education institution;

· an entity that is registered by a training recognition authority of a State or Territory in accordance with the Australian Recognition Framework to provide skill recognition (assessment only) services; or

· an authority of the Commonwealth or of a State or Territory; or

· a local government body.

You assess individuals who undertake the training courses for the purpose of obtaining certification from the relevant authority. Furthermore, you are accredited by the relevant authority as a trainer and assessor. As such, your supply of assessment is GST-free.

Question 3

Section 38-95 of the GST Act provides that a supply of course materials for a subject undertaken in an education course is GST-free.

As discussed above, your supply of the training courses is a GST-free education course. Accordingly, your supply of the training materials is also GST-free.