| Disclaimer This edited version has been archived due to the length of time since original publication. It should not be regarded as indicative of the ATO's current views. The law may have changed since original publication, and views in the edited version may also be affected by subsequent precedents and new approaches to the application of the law. You cannot rely on this record in your tax affairs. It is not binding and provides you with no protection (including from any underpaid tax, penalty or interest). In addition, this record is not an authority for the purposes of establishing a reasonably arguable position for you to apply to your own circumstances. For more information on the status of edited versions of private advice and reasons we publish them, see PS LA 2008/4. |
Edited version of private advice
Authorisation Number: 1013001398302
Date of advice: 03 May 2016
Ruling
Subject: Goods and services tax and employee liabilities
The ruling concerned the GST treatment of statutory imposed liabilities under a sale contract. The Commissioner has ruled in the following way:
Question
Will the Commissioner of Taxation (the Commissioner) accept that under a sale contract, employee liabilities excluding statutory imposed liabilities, such as long service leave, represent additional consideration for the vendor's supply of assets including employee assets to the purchaser?
Answer
Yes, the employee liabilities excluding statutory imposed liabilities, such as long service leave, will represent additional consideration for the vendor's supply of assets including employee assets to the purchaser.
This is consistent with the Commissioner's view as discussed in Goods and Services Tax Ruling GSTR 2004/9 Goods and services tax: GST consequences of the assumption of vendor liabilities by the purchaser of an enterprise (GSTR 2004/9).
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 9-10
A New Tax System (Goods and Services Tax) Act 1999 section 9-15
A New Tax System (Goods and Services Tax) Act 1999 section 9-75