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Edited version of private advice
Authorisation Number: 1051829732931
Date of advice: 1 July 2021
Ruling
Subject: GST and the services provided to non-residents
Issues
The Commissioner was asked to rule on whether:
1. the importation of certain parts by an Australian resident agent into Australia for a non-resident principal is a non-taxable importation pursuant to subsection 42-5(1) of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act) such that no GST is payable on the importation of the parts by the resident agent,
2. in the event the Commissioner determines that the importation of parts is not a non-taxable importation, the Australian entity that acts as resident agent for a non-resident entity (principal) is entitled to claim an input tax credit under section 57-10 of the GST Act for the GST incurred on the taxable importation of parts on the basis that the requirements for creditable importation under section 15-5 of the GST Act should be satisfied by the non-resident,
3. the resident agent's supply of certain services to another non-resident entity (that is not the principal) satisfies the GST-free requirements under item 2 in the table in subsection 38-190(1) of the GST Act (item 2).
Ruling
The Commissioner ruled as follows:
1. No, the importation of the parts will not be treated as a non-taxable importation pursuant to subsection 42-5(1) of the GST Act.
2. No, the resident agent is not entitled to an input tax credit for the GST paid on the taxable importation of the parts under section 57-10 of the GST Act when it is acting as a resident agent for the non-resident principal who makes the taxable importation of the parts into Australia. This is because the non-resident principal's importation is not a creditable importation as the non-resident principal does not make the importation in the course or further of an enterprise.
3. The supply of some services are GST-free under item 2 as these services are made and provided to another non-resident and subsection 38-190(3) of the GST Act does not override that GST-free status.
The supply of some of the other services of 'providing' technical assistance and training within Australia to an Australian entity's personnel is GST-free under item 2 but subsection 38-190(3) of the GST Act may negate GST-free status in limited circumstances.