| Disclaimer This edited version has been archived due to the length of time since original publication.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: 1051605470441
Date of advice: 7 November 2019
Ruling
Subject: GST and psychology services
Question
Is the supply of psychology services that you provide to patients under a sub-contract arrangement with a psychology business GST-free under subsection 38-10(1) of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act)?
Answer
No, the supply of psychology services that you provide to patients under a sub-contract arrangement with a psychology business is not GST-free under subsection 38-10(1) of the GST Act.
Relevant facts and circumstances
You are registered for goods and services tax (GST). You are a psychologist registered with the Australian Health Practitioner Regulation Agency (AHPRA). The registration standards for psychologists have been developed by the Psychology Board of Australia.
You currently work at the Practice. You started working at the Practice as a psychologist after entering into a sub-contract agreement (the agreement).
For the purposes of this ruling, we have made the assumption that you are not an employee and are a contractor.
Relevant legislative provisions
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 9-5
Reasons for decision
A supply of other health services is GST-free under subsection 38-10(1) of the GST Act if:
· if 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 A New Tax System (Goods and Services Tax) Regulations 2019 (GST Regulations)
· the supplier is a recognised professional in relation to the supply of services of that kind, and
· the supply would generally be accepted in the profession associated with supplying services of that kind as being necessary for the appropriate treatment of the recipient of the supply.
You provide psychology services to patients of the Practice. You are registered with the AHPRA and therefore you are a recognised professional in relation to the supply of psychology services.
For a supply of psychology services to be GST-free under subsection 38-10(1) of the GST Act, the supply must be made to the patient who is receiving the treatment. Therefore, it is necessary to determine who you are making the supply to.
The agreement refers to you as being a sub-contractor of services.
On the balance of the facts it appears you are making a supply of sub-contract services to the Practice. The Practice is making a supply of psychology services to the patients, with you as the provider.
As you are making the supply to the Practice and not the patient, the supply is not the supply of treatment to the recipient of the supply (patient). Therefore, you are not making a GST-free supply of psychology services under subsection 38-10(1) of the GST Act. Your supply is a taxable supply under section 9-5 of the GST Act provided you remain registered or required to be registered for GST.