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Edited version of private advice
Authorisation Number: 1052001412408
Date of advice: 18 July 2022
Ruling
Subject: GST and income from a social media platform
Question
Are payments received from a social media platform subject to GST?
Answer.
No, payments received from the social media platform are not subject to GST.
Relevant facts and circumstances
You carry on an enterprise under a contract with a social media platform under which you get paid by the social media platform.
The social media platform operator is a non-resident and is not in Australia.
You are currently registered for GST.
Your current and projected income has reached the GST registration turnover threshold.
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 38-190(1)
A New Tax System (Goods and Services Tax) Act 1999 section 195-1
Reasons for decision
Detailed reasoning
Are the payments received from the social media platform subject to GST?
To address this issue, the first step is to identify the nature of the supply you make to the social media platform.
The term 'supply' is defined in subsection 9-10(1) of the GST Act as 'any form of supply whatsoever' and includes a creation, grant, transfer, assignment or surrender of any right (paragraph 9-10(2)(e) of the GST Act). This definition requires an entity, the supplier to make the supply and another entity, the recipient to acquire the supply.
The Commissioners' views on supplies are outlined in several goods and services tax rulings. Goods and Services Tax Ruling GSTR 2006/9, Goods and services tax: supplies provides ten propositions that are considered relevant in analysing a transaction in relation to a supply.
Proposition 11 detailed in GSTR 2006/9 provides that the agreement is the logical starting point when working out the entity making the supply and the recipient of that supply.
Therefore, to determine the nature of the supply regard must be given to the terms and conditions set out in the social media platform's contract.
We consider that you make a supply to the social media platform and this supply is a GST-free supply under table item 2 of subsection 38-190(1) of the GST Act.