Edited version of your written advice

Authorisation Number: 1013030816991

Ruling

Subject: GST and supply of services to home care recipients

Question

Are you making a taxable supply under section 9-5 of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act) when you supply gardening and general home maintenance services to care recipients?

Answer

Yes, you are making a taxable supply under section 9-5 of the GST Act when you supply gardening and general home maintenance services to care recipients.

Relevant facts and circumstances

You provide gardening and general home maintenance services to home care recipients.

The invoices for your services are issued in the names of the individual home care recipients but are given to a managing agent who pays for the invoices on behalf of the home care recipients.

It is your understanding that the home care recipients have home care packages in place under the Aged Care Act 1997.

You do not receive home care subsidy under Part 3-2 of the Aged Care Act 1997.

You do not receive funding under the Home and Community Care Act 1985 or from the Commonwealth, a state or a territory in connection with the supply of your services.

You are registered for GST and you have been treating the supply of your services as taxable.

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 9-40

A New Tax System (Goods and Services Tax) Act 1999 Section 38-30

Reasons for decision

Section 9-40 of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act) provides that you must pay the GST payable on any taxable supply that you make.

Section 9-5 of the GST Act 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 the indirect tax zone; and

(d) you are *registered, or *required to be registered.

(e) However, the supply is not a *taxable supply to the extent that it is *GST-free or *input taxed.

(* denotes a defined term in the GST Act.)

The supply of gardening and general home maintenance services to the home care recipients satisfies the requirements of paragraphs 9-5(a), 9-5(b), 9-5(c) and 9-5(d) of the GST Act as follows:

• the supply is for consideration

• the supply is made in the course of your enterprise

• the supply is connected with Australia, and

• you are registered for GST.

Therefore, the supply of the gardening and general home maintenance services to the home care recipients is taxable to the extent that the supply is not input taxed or GST-free.

There is no provision in the GST Act for the supply of the gardening and general home maintenance services to the home care recipients to be input taxed. What remains to be considered is whether the supply is GST-free.

Section 38-30 of the GST Act deals with the GST-free supply of home care services and it states:

(1) A supply of *home care is GST-free if home care subsidy is payable under Part 3.2 of the Aged Care Act 1997 or Part 3.2 of the Aged Care (Transitional Provisions) Act 1997 to the supplier for the care.

(2) A supply of care is GST-free if the supplier receives funding under the Home and Community Care Act 1985 in connection with the supply.

(3) A supply of *home care is GST-free if the supply is of services:

(a) that are provided to one or more aged or disabled people; and

(b) that are of a kind covered by item 2.1 (daily living activities assistance) of Part 2 of Schedule 1 to the *Quality of Care Principles.

(4) A supply of care is GST-free if:

(a) the supplier receives funding from the Commonwealth, a State or a Territory in connection with the supply; and

(b) the supply of the care is of a kind determined in writing by the *Aged Care Minister to be similar to a supply that is GST-free because of subsection (2).

'Home care' is defined in section 195-1 of the GST Act to have the meaning given by section 45-3 of the Aged Care Act 1997 which provides that home care is care consisting of a package of personal care services and other personal assistance provided to a person who is not being provided with residential care.

The supply of services to a care recipient by a government funded supplier is GST-free where the requirements of subsections 38-30(1), 38-30(2) or 38-30(4) of the GST Act are met.

It is your understanding that the home care recipients have home care packages in place under the Aged Care Act 1997. However, you as the supplier of the services do not receive a subsidy under the Aged Care Act 1997 or the Aged Care (Transitional Provisions) Act 1997 for your supply of gardening and general home maintenance services. Therefore, you do not satisfy the requirements of subsection 38-30(1) of the GST Act.

You do not receive funding under the Home and Community Care Act 1985. Hence, you do not satisfy the requirements of subsection 38-30(2) of the GST Act.

As stated earlier, one of the requirements of subsection 38-30(4) of the GST Act is that the supplier receives funding from the Commonwealth, a State or a Territory in connection with the supply.

In your case, you do not receive funding from the Commonwealth, a State or a Territory in connection with your supply of gardening and general home maintenance services. Therefore, you do not satisfy the requirements of subsection 38-30(4) of the GST Act.

Under subsection 38-30(3) of the GST Act, the supply of home care services by a non-government funded supplier is GST-free to the extent that the services are of a kind covered by item 2.1 of Part 2 of Schedule 1 to the Quality of Care Principles. These services are:

Personal assistance, including individual attention, individual supervision, and physical assistance with:

(a) bathing, showering, personal hygiene and grooming;

(b) maintaining continence or managing incontinence, and using aids and appliances designed to assist continence management;

(c) eating and eating aids, and using eating utensils and eating aids (including actual feeding if necessary);

(d) dressing, undressing, and using dressing aids;

(e) moving, walking, wheelchair use, and using devices and appliances designed to aid mobility, including the fitting of artificial limbs and other personal mobility aids; and

(f) communication, including to address difficulties arising from impaired hearing, sight or speech, or lack of common language (including fitting sensory communication aids), and checking hearing aid batteries and cleaning spectacles;

Excludes hairdressing.

As the supply of gardening and general home maintenance services is not covered by item 2.1 of Part 2 of Schedule 1 to the Quality of Care Principles, you do not satisfy the requirements of subsection 38-30(3) of the GST Act.

Hence, the supply of gardening and general home maintenance services is not GST-free under section 38-30 of the GST Act. Furthermore, the supply is not GST-free under any other provision of the GST Act or another Act.

Therefore, as the supply of gardening and general home maintenance services to the care recipients satisfies all the requirements of section 9-5 of the GST Act, you are making a taxable supply. Hence, GST is payable on the supply.