Edited version of your written advice

Authorisation Number: 1012664990110

Ruling

Subject: Goods and services tax (GST) and occupational licences

Question 1

Is GST payable on your supply of a renewal of a (you) licence where the applicant renews their licence from an overseas location?

Answer

No.

Question 2

Is GST payable on your supply of a (you) licence where the applicant is overseas when they apply for the licence and they use their international qualification to obtain the licence?

Answer

No.

Question 3

Is GST payable on your sales of log books when you export the log books from Australia?

Answer

No.

Relevant facts and circumstances

You are registered for GST.

You originated as the Australian national occupational (certain professional) certification scheme. You were developed by the Australian federal government as a certification scheme.

You are an RTO. You are accredited under the RTO system to provide (certain activity) courses and assessments.

As the Australian national occupational (certain professional) certification scheme, you provide certification of people in certain occupations in recognition of their having been trained and assessed in compliance with national and international legislative requirements and/or in keeping with (you) best practice standards and procedures.

For occupational activities in Australia, all relevant professionals who intend to undertake certain sort of work are required under the various State and Territory Occupational Health and Safety legislative arrangements to have an appropriate occupational (certain activity) certificate in accordance with Australian standards.

For any occupational (certain activity) sectors where certification is not regulated, an (you) certificate of competency at an appropriate level will serve as proof of competency for the regulatory authority.

For work outside Australia, there is a requirement that certain professionals who are undertaking certain work are (you) certified and demonstrate competency.

Renewal of (you) licence

(You) licences must be renewed, every few years, to remain current. Certain professionals and allied professionals who apply for renewal of their (you) licence are mostly in Australia but some are working overseas when they apply. Some may apply for renewal in Australia and then go overseas within the licence periods. Some may apply while overseas and remain overseas and others will return to Australia during the licence period.

Crossover to (you) licence

You currently have agreements in place with numerous international bodies allowing (you) certificate holders to work overseas, and for international certificate holders to gain recognition in Australia.

Certain professionals who hold certifications from one of the issuing bodies that you have an agreement with may be eligible to 'crossover' to gain an (you) certification. The crossover process involves submitting a 'crossover application form' to you and providing all required documentation. You review the current qualifications and evaluate their current competence.

The majority of those that apply for an (you) licence by crossover apply from overseas whilst others apply after arriving in Australia.

The applicants apply for a licence (including a licence renewal) by postal mail, fax or e-mail.

You mail licence cards (including renewal licence cards) to the postal addresses nominated by the applicants. These addresses may be in Australia or overseas.

Logbooks

You sell logbooks. In some cases, you export the logbooks from Australia. You export the books within 60 days after the date you issue the invoice and within 60 days after you receive payment.

Relevant legislative provisions

A New Tax System (Goods and Services Tax) Act 1999 subsection 7-1(1)

A New Tax System (Goods and Services Tax) Act 1999 section 9-5

A New Tax System (Goods and Services Tax) Act 1999 section 9-40

A New Tax System (Goods and Services Tax) Act 1999 section 38-110

A New Tax System (Goods and Services Tax) Act 1999 section 38-185

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

Reasons for decisions

Questions 1 and 2

Summary

Your supplies of licences (including renewal licences) are GST-free under a provision dealing with recognition of prior learning.

Detailed reasoning

GST is payable by you on your taxable supplies.

You make a taxable supply where you satisfy the requirements of section 9-5 of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act), which states:

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.

(*Denotes a term defined in section 195-1 of the GST Act)

You meet the requirements of paragraphs 9-5(a) to 9-5(d) of the GST Act because:

• you are supplying licences (including renewal licences) for consideration; and

• you supply the licences, licence renewals and log books in the course or furtherance of an enterprise that you carry on

• your supplies are connected with Australia; and

• you are registered for GST.

There are no provisions in the GST Act under which your supplies of the licences (including renewal licences) are input taxed. Therefore, what remains to be determined is whether your supplies of the licences are GST-free.

Recognition of prior learning

Section 38-110 of the GST Act states:

(1) A supply is GST-free if the supply is the assessment or issue of

qualifications for the purposes of:

(a) access to education; or

(b) membership of a professional or trade association; or

(c) registration or licensing for a particular occupation; or

(d) employment.

(2) However, a supply is not GST-free under subsection (1) unless the supply is carried out by:

(a) a professional or trade association; or

(b) an *education institution; or

(c) 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

(d) an authority of the Commonwealth or of a State or Territory; or

(e) a local government body.

It is not essential for an entity to actually provide assessments in order to meet the requirement of paragraph 38-110(2)(c) of the GST Act.

You issue qualifications (licences) for the purpose of employment (working in a certain profession etc). Therefore, you meet the requirement of subsection 38-110(1) of the GST Act.

You are an RTO and assessment services are within the scope of your RTO registration. Hence, you are registered by a training recognition authority of a State or Territory in accordance with the Australian Recognition Framework to provide skill recognition (assessment) services. Therefore, the requirement of paragraph 38-110(2)(c) of the GST Act is met.

Hence, as you meet the requirements of section 38-110 of the GST Act, you are making GST-free supplies of licences.

Therefore, your supplies of the licences (including renewal of licences) are not taxable. Therefore, GST is not payable on your supplies of the licences.

Additional information

Your supplies of licences to overseas applicants are also GST-free under section 38-190 of the GST Act. Section 38-190 of the GST Act deals with supplies consumed overseas.

Question 3

Item 1 in the table in subsection 38-185(1) of the GST Act provides that a sale of goods is GST-free if the supplier exports the goods from Australia before, or within 60 days after:

(a) the day on which the supplier receives any of the consideration for the supply; or

(b) if, on an earlier day, the supplier gives an invoice, for the supply - the day on which the supplier gives the invoice.

You sell logbooks under arrangements that require you to export these books from Australia. You export the books within 60 days after the date you issue the invoice and within 60 days after you receive payment. Therefore, your sales of logbooks under these arrangements are GST-free under item 1 in the table in subsection 38-185(1) of the GST Act. Hence, your sales of logbooks under such circumstances are not taxable supplies. Therefore, GST is not payable on your sales of logbooks under the circumstances stated.