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Edited version of your written advice
Authorisation Number: 1012694205511
Ruling
Subject: GST and the supply of massage therapy
Question
Is your supply of remedial massage therapy services a taxable supply?
Answer
Yes.
Relevant facts and circumstances
You are registered for GST.
You provide massage therapy services.
Your employ full time and part time massage therapists. You also employ subcontractors to provide massage therapy services.
Clients attend either by appointment or on a walk in basis.
Your director is a member of the relevant professional association. You have provided a copy of the membership certificate.
You also provide remedial massage services.
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 Subsection 38-10(1)
A New Tax System (Goods and Services Tax) Act 1999 Section 38-7
Reasons for decision
Under 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;
(b) the supply is made in the course or furtherance of an enterprise that you carry on;
(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 supplies for consideration, and the supplies are for furtherance of the enterprise that you carry on, they are connected with Australia and you are registered for GST. Therefore, your supplies will be taxable unless they are GST-free or input taxed. There are no provisions in the GST Act that would make your supplies input taxed. However, Division 38 of the GST Act makes certain supplies GST-free.
Subsection 38-10(1) of the GST Act provides that a supply of health services is GST-free where:
it is a service of a kind specified in the table in subsection 38-10(1) of the GST Act or of a kind specified in the regulations, and
the supplier is a recognised professional in relation to the supply of services of that kind, and
the supply is generally accepted in the relevant profession as being necessary for the appropriate treatment of the recipient of the supply.
Each of these requirements must be satisfied for the supply of remedial massage therapy to be GST-free.
The table in section 38-10(1) of the GST Act lists 21 services:
1. Aboriginal or Torres Strait Islander health 11. Occupational therapy
2. Acupuncture 12. Optometry
3. Audiology, audiometry 13. Osteopathy
4. Chiropody 14. Paramedical
5. Chiropractic 15. Pharmacy
6. Dental 16. Psychology
7. Dietary 17. Physiotherapy
8. Herbal medicine (including traditional 18. Podiatry
Chinese herbal medicine) 19. Speech pathology
9. Naturopathy 20. Speech therapy
10. Nursing 21. Social work
No additional services are set out in the Regulations.
To satisfy requirement (a), the service must be the provision of one of those actual services listed and not just something similar to one of those services. Neither massage therapy services or remedial massage therapy services are listed in the table. Therefore, remedial massage therapy in itself does not satisfy the first requirement in subsection 38-10(1) of the GST Act that the service must be specified in the table.
Accordingly, whilst a supplier may be a qualified massage therapist, who is recognised as a professional in their industry and is making a supply of l massage services that is generally accepted in the relevant profession as being necessary for the appropriate treatment of the recipient of the supply, the supply will not be GST-free. This is because remedial massage therapy is not listed in the table in section 38-10(1) of the GST act and requirement (a) is not met. Therefore neither your supplies of massage services through your employees or the supplies made by your subcontractors will be GST-free.
Therefore the supplies of massage services or remedial massage services will be taxable supplies.