| Disclaimer 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: 1052140296153
Date of advice: 24 July 2023
Ruling
Subject: GST and supply of services to non-residents
Question 1
Is the entity liable under section 57-5 of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act) to pay the GST on sales of goods by the non-resident manufacturers?
Question 2
Is the entity making taxable supplies under section 9-5 of the GST Act of services for which they receive commission payments under the contracts entered into with the non-resident manufacturers?
Decision 1
No, as the entity is not acting as agent for the non-resident manufacturers in relation to the sale of the goods, any GST liability on the sale of those goods remains with the non-resident manufacturer. The entity is not liable under section 57-5 of the GST Act to pay the GST on sales of goods by the non-resident manufacturers.
Decision 2
No, the entity is not making taxable supplies under section 9-5 of the GST Act of services for which they receive commission payments under the contracts entered into with the non-resident manufacturers. The supply made by the entity is a GST-free supply under paragraph (a) of item 2 in the table in subsection 38-190(1) of the GST Act. The GST-free status of the supplies is not negated by any other provision in section 38-190 either. Therefore, the entity is not liable for GST on the supply of services made to the non-resident manufacturers who are not in Australia when the supplies are made.
Relevant facts and circumstances
The entity is an Australian company that supplies services to non-resident manufacturers who are not in the indirect tax zone when the services are performed.
The non-resident manufacturers supply goods to Australian customers.
The entity promotes the goods to the Australian market and undertakes other services for the non-resident manufacturers.
The entity is not an agent of the non-resident manufacturers and does not make any supplies in Australia on-behalf of the manufacturers.
The entity is registered for GST.
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 subsection 38-190(1)