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Edited version of private ruling

Authorisation Number: 1011749093764

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Ruling

Subject: Prepaid Cards

Questions

    1. For the purposes of item 1 in the table in subregulation 40-5.09(3) of the A New Tax System (Goods and Services Tax) Regulations, 1999 (GST Regulations), is the provision of a prepaid card by Entity A to a Entity C under a Program the provision to the Entity C of an interest in an account made available by Entity A?

    2. For the purposes of Section 9-5 of the GST Act, are the services provided to Entity B that are referred to in the Program Fees an aim in themselves and therefore taxable supplies made to Entity B, if they are provided for consideration?

      (a) Alternatively, are those services provided to Entity B, so closely linked to the accounts provided to Entity C that they form, objectively, a single, indivisible economic supply, which it would be artificial to split and as such the services are merely incidental to the provision of the accounts to Entity C?

    3. If services provided to Entity B is a taxable supply when provided for consideration, please confirm the total consideration for the taxable supply would be the fees charged to Entity B under the negotiated Program between Entity A and Entity B.

Answers

    1. The Commissioner ruled that for the purposes of item 1 in the table in subregulation

    40-5.09(3) of the GST Regulations, the provision of a prepaid card by Entity A to a Entity C under a Program is the provision to the Entity C of an interest in an account made available by Entity A.

    2. The Commissioner ruled that for the purposes of section 9-5 of the GST Act, the services provided that are referred to in the Program Fees are an aim in themselves and therefore taxable supplies made to Entity B, if they are provided for consideration

    3. The Commissioner confirmed that the total consideration for the taxable supply would be the fees charged to Entity B under the negotiated Program between Entity A and Entity B.


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