Edited version of your private ruling

Authorisation Number: 1012610466012

Ruling

Subject: GST and services to non-residents

Question

Is your supply of project management and construction services to the non-resident recipients GST-free?

Answer

Yes, your supply of project management and construction services to the non-resident recipients is GST-free.

The supply of your project management and construction services satisfies the requirements under paragraphs 9-5(a), 9-5(b), 9-5(c) and 9-5(d) of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act) because:

a) the supply that you make is for consideration;

b) you make the supply in the course of an enterprise that you carry on in Australia;

c) the supply is connected with Australia because your supply of services is performed in Australia; and

d) you are registered for GST in Australia.

However, under section 9-5 of the GST Act, a supply is not a taxable supply to the extent that it is input taxed or GST-free. The supply of your project management and construction services is not input taxed under the GST Act. Therefore, it remains to be determined whether your supply is GST-free.

Your supply of project management and construction services satisfies the requirements of item 2 in the table in subsection 38-190(1) of the GST Act and is a GST-free supply because:

• the non-resident recipients do not carry on a business of their own in Australia. Nor do they carry on a business through a representative in Australia. Therefore, we consider that the non-resident recipients are not in Australia in relation to your supply of project management and construction services when the supply is made.

• the non-resident recipients acquire your supply of project management and construction services in carrying on their enterprise. The non-resident recipients are not registered for GST nor are they required to be registered for GST in Australia.

Subsection 38-190(3) of the GST Act does not negate the GST-free status of your supply because:

• your supply of project management and construction services is a supply under an agreement entered into with non-resident entities.

• there is no expressed agreement between you and the non-resident recipients to provide your supply of project management and construction services to another entity within Australia.

Relevant facts and circumstances

This ruling is based on the facts stated in the description of the scheme that is set out below. If your circumstances are materially different from these facts, this ruling has no effect and you cannot rely on it. The fact sheet has more information about relying on your private ruling

You are an Australian company and you are registered for GST.

The non-resident recipients are overseas companies who contract with you to organise the construction of the exhibition stands for shows in Australia. You supply project management, equipment hire, installation, dismantling and disposal of stand components services to the non-resident recipients.

You provided a copy of your quotation and a copy of your Tax Invoice to the non-resident recipients.

You subcontract local contractors to carry out the work. These contractors are not your employees and have no contact with the non-resident recipients. They are aware that you design show stands for the non-resident recipients.

You are not the non-resident recipients' agents. The non-resident recipients have no presence in Australia. They do not do business in Australia themselves or through an Australian agent. They are not registered or required to be registered for GST. They are not present in Australia when the stands are erected. They do not attend the shows in Australia.

The non-resident recipients have contracts with third party overseas entities for the construction of the stands. The end users of the stands are the third party overseas entities, who send staff to manage the stands on the days of the shows. The third party overseas entities sell exhibition space on the stands to various overseas businesses. Hence, the stands are occupied by various overseas businesses who exhibit their goods/services on the stands.

Your role is to write to the organiser of the shows to submit your stand designs and signage for the stands and ensure that your designs of the stands comply with the regulations of the shows. You then subcontract to various Australian businesses/ companies to do the work.

The sub-contractors you hire will charge you directly for their supply of labour.

You do not have a contract with the third party overseas entities. They send staff to Australia during the show to liaise with the businesses who exhibit on the stands. You give them your mobile phone number in case anything goes wrong with the stands or the equipment you hire to the non-resident recipients during the trade show.

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 9-20

A New Tax System (Goods and Services Tax) Act 1999 Subsection 38-190(1)

A New Tax System (Goods and Services Tax) Act 1999 Subsection 38-190(3)