Edited version of your written advice

Authorisation Number: 1051502616332

Date of advice: 4 April 2019

Ruling

Subject: GST and other health services

Question

Is the annual subscription fee, charged by you for an online forum, GST-free pursuant to subsection 38-10(1) of the A New Tax System Goods and Services Act 1999 (GST Act)?

Answer

No. The annual subscription fee, charged by you for an online forum, is not GST-free pursuant to subsection 38-10(1) of the GST Act. The supply is a taxable supply.

Relevant facts and circumstances

You are an Australian entity which is registered for goods and services tax (GST). You report your GST obligations on a quarterly basis and account on a cash basis.

You facilitate an online forum through a website and social media platforms.

You advised that you have a qualified dietician who is a full member of the Dieticians Association of Australia. The qualified dietician facilitates the online forum.

Subscribers pay a subscription fee to access to general dietary information for infants through videos, blogs and social media platforms. Anyone can become a subscriber of the website.

You advised that the online services result in additional consultations which are charged separately and don’t form part of the $x fee.

Relevant legislative provisions

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

A New Tax System (Goods and Service Tax) Act 1999 subsection 38-10(1)

Reasons for decision

In this ruling:

● unless otherwise stated, all legislative references are to the A New Tax System (Goods and Services Tax) Act 1999 (GST Act),

● all terms marked by an *asterisk are defined terms in the GST Act, and

● all reference materials, published by the Australian Taxation Office (ATO), that are referred to are available on the ATO website ato.gov.au

Section 9-5 provides you make a taxable supply if:

● you make the supply for consideration

● the supply is made in course or furtherance of an enterprise that you carry on

● the supply is connected with the indirect tax zone, and

● you are registered or required to be registered for GST.

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

Under subsection 38-10(1) a supply of other health services is GST-free if:

(a) the service is of a kind specified in the table in subsection 38-10(1), or of a kind specified in the A New Tax System (Goods and Services Tax) Regulations 1999 (GST Regulations)

(b) the supplier is a *recognised professional in relation to the supply of services of that kind; and

(c) the supply would generally be excepted, in the profession associated with suppling services of that kind, as being necessary for the appropriate treatment of the *recipient of the supply

You must satisfy all three of the above requirements for the supply to be GST-free.

The first requirement is that the service of a kind is specified in the table in subsection 38-10(1) or the GST Regulations. Dietary is listed at item 7 of the table in subsection 38-10(1).

The second requirement is that you satisfy the definition of a *recognised professional. Division 195-1 provides the definition of a recognised professional:

A person is a *recognised professional, in relation to the supply of a service of a kind specified in the table in subsection 38-10(1), if:

(a) the service is supplied in a State or Territory in which the person has a permission or approval, or is registered, under a * State law or a * Territory law prohibiting the supply of services of that kind without such permission, approval or registration; or

(b) the service is supplied in a State or Territory in which there is no State law or Territory law requiring such permission, approval or registration, and the person is a member of a professional association that has uniform national registration requirements relating to the supply of services of that kind; or

(c) in the case of services covered by item 3 in the table - the service is supplied by an accredited service provider within the meaning of section 4 of the Hearing Services Administration Act 1997.

You advised that you have a qualified dietician and who is a full member of the Dieticians Association of Australia. The dietician satisfies the definition of a recognised professional.

The third requirement of subsection 38-10(1) is that the service must be generally accepted in the professions associated with supplying services of that kind as being necessary for the appropriate treatment of the recipient of the supply. 'Appropriate treatment' is not defined in the GST Act.

The Goods and Services Tax Industry Issue: Health Industry Partnership publication provides the Australian Taxation Office’s view on section 38-10.

Paragraph 10 provides that it is considered that 'appropriate treatment' will be established where the recognised professional assesses the recipient's state of health and determines a process to pursue, in an attempt to preserve, restore or improve the physical or psychological wellbeing of that recipient insofar as that *recognised professional's particular area of training allows and will include subsequent supplies for the determined process.

You advised that the subscription gives access to a range of resources including videos, blogs and discussions on social media platforms. You advised that occasionally, the dietician receives direct messages from subscribers however the dietician only provides basic recommendations.

Although the members are entitled to get one-on-one discussions with the qualified dietician, it is an additional charge and does not form part of the annual subscription fee. The subscribers are not being assessed by the recognised professional at the point of purchasing the subscription to your website. The supply of the subscription services does not satisfy paragraph 38-10(1)(c) of the GST Act. As such the supply is not GST-free under subsection 38-10(1).

Therefore, the supply of subscriptions by you to the subscribers in Australia is a taxable supply under section 9-5 and you will be liable for GST on that supply.