Edited version of your private ruling

Authorisation Number: 1011950781057

This edited version of your ruling will be published in the public register of private binding rulings after 28 days from the issue date of the ruling. The attached private rulings fact sheet has more information.

Please check this edited version to be sure that there are no details remaining that you think may allow you to be identified. If you have any concerns about this ruling you wish to discuss, you will find our contact details in the fact sheet.

Ruling

Subject: GST and migration services

Question 1

Is GST payable on your supply of migration services?

Answer

Supplies of migration services you make to foreign nationals who are overseas at the time of supply are GST-free supplies either under Item 2(a) or Item 3 of subsection 38-190(1) of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act).

Relevant facts and circumstances

You are an Australian Migration Agent, based in Australia and practicing overseas. A substantial proportion of the visa applicants you deal with are foreign nationals overseas.

You engage a local migration agency overseas to process basic visa applications which are emailed to you for checking and correction if necessary. You give permission for the applications to be lodged. You instruct your customers to pay your fees into an Australian bank account, at times the fees are paid by the applicant's spouse or relatives who are in Australia.

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 9-25

A New Tax System (Goods and Services Tax) Act 1999 section 38-190

Reasons for decision

Summary

Supplies of migration services you make to foreign nationals who are overseas at the time of supply are GST-free supplies. It does not matter that a person in Australia pays for the service.

Detailed reasoning

A supply of services is a taxable supply and subject to GST if it meets the requirements of section 9-5 of the GST Act which states:

You make a taxable supply if:

(e) you make the supply for *consideration; and

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

(g) the supply is *connected with Australia; and

(h) 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.

Your supply of migration services meets the requirements of paragraphs (a) to (d) above; you make your supply in return for fees, you make your supply in the course of carrying on your migration services enterprise, your supply is connected to Australia as it is done in your offices in Australia and you are registered for GST.

However your supply, despite meeting the requirements of section 9-5 of the GST Act does not attract GST if it is either GST-free or input taxed. There are no input taxed provisions in the law that cover a supply of migration services.

Your services will be GST-free where they are made to a visa applicant who is a non-resident and not in Australia at the time of your supply. Item 2(a) in subsection 38-190(1) of the GST Act states:

38-190 Supplies of things, other than goods or real property, for consumption outside Australia

The third column of this table sets out supplies that are GST-free (except to the extent that they are supplies of goods or *real property):

Supplies of things, other than goods or real property, for consumption outside Australia
Item	Topic	These supplies are GST-free (except to the extent that they are supplies of goods or *real property)...
1	…	…
2	Supply to *non-resident outside Australia.	a supply that is made to a *non-resident who is not in Australia when the thing supplied is done, and: (a) the supply is neither a supply of work physically performed on goods situated in Australia when the work is done nor a supply directly connected with *real property situated in Australia; or (b) ...

At times when supplying migration services to visa applicants who are overseas you deal with someone in Australia, usually in regard to the payment of fees. As long as the beneficiary of your supply (the visa applicant) is not in Australia at the time of supply, your services remain GST-free. This situation is dealt with in item 3 in subsection 38-190(1) of the GST Act in conjunction with subsection 38-190(4) of the GST Act. Item 3 allows for:

Subsection 38-190(4) further explains that the GST-free treatment afforded under Item 3 is based on the status of the real beneficiary of the supply rather than the status of a person who merely pays or contracts for the supply:

(4) A supply is taken, for the purposes of item 3 in that table, to be a supply made to a *recipient who is not in Australia if:

(a) it is a supply under an agreement entered into, whether directly or indirectly, with an *Australian resident; and

(b) the supply is provided, or the agreement requires it to be provided, to another entity outside Australia.

In the case of your supplies of migration services the real beneficiaries are considered to be visa applicants rather than the Australian based relatives, spouses etc. who may pay the fees.

Finally, a proportion of your supplies may be taxable. If your service is supplied to a visa applicant who is in Australia at the time of your supply, the supply is taxable; neither Item 2(a) nor Item 3 is applicable if the recipient of a supply is in Australia.