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Edited version of private advice
Authorisation Number: 1052083481550
Date of advice: 7 February 2023
Ruling
Subject: GST and agency
Question 1
Does the Commissioner agree that for GST purposes, Entity B will not procure the collection of fees as principal, but does so merely as collection agent for Entity A?
Answer
Yes, the Commissioner agrees that for GST purposes Entity B will not procure the collection of fees as principal but does so merely as collection agent for Entity A.
Question 2
Will the collection of fees by Entity B be consideration for a taxable supply by Entity B to Entity A's customers?
Answer
No, the collection of fees by Entity B will not be consideration for a taxable supply made by Entity B to Entity A's customers. This is because Entity B is acting as agent for Entity A and the fees it collects is consideration for supplies made by Entity A to its customers.
This ruling applies for the following periods:
XX August 20XX to XX June 20XX
The scheme commenced on:
XX August 20XX
Relevant facts and circumstances
Entity A is currently registered for GST.
Entity B which is also currently registered for GST, has entered into a contract with Entity A to collect fees from the customers of Entity A under an agency arrangement.
Entity B will be paid by Entity A for the provision of these agency services to Entity A.
Entity A and Entity B will not enter into a Subdivision 153-B Agreement in respect of any supplies or acquisitions.
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