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Is the entity, a supplier of engineering services, making a GST-free supply under item 1 in the table in subsection 38-190(1) of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act), when it is subcontracted by an Australian resident company to provide engineering services to that company's overseas customer for the construction of premises outside Australia?

Yes, the entity is making a GST-free supply under item 1 in the table in subsection 38-190(1) of the GST Act, when it is subcontracted by an Australian resident company to provide engineering services to that company's overseas customer for the construction of premises outside Australia.

The entity is a supplier of engineering services. The entity is subcontracted by an Australian resident company to provide engineering services to that company's overseas customer for the construction of premises outside Australia.

The entity performs some of the design work in Australia and some work in the overseas country.

The entity is registered for goods and services tax (GST).

Under section 38-190 of the GST Act, certain supplies, other than goods or real property for consumption outside Australia are GST-free. As a supply of engineering services is not a supply of goods or real property, its GST status is appropriately considered under section 38-190 of the GST Act.

The most relevant item to this case is item 1 in subsection 38-190(1) of the GST Act (Item 1) which deals with supplies connected with property outside Australia. Item 1 provides that a supply is GST-free where the supply is directly connected with goods or real property situated outside Australia.

The entity is subcontracted by an Australian resident company to provide engineering services to that company's overseas customer for the construction of premises outside Australia. It is considered that this supply is a supply that is directly connected with real property situated outside Australia.

Therefore, the requirements of item 1 in the table in subsection 38-190(1) of the GST Act are satisfied and the entity is making a GST-free supply to the Australian resident company when it provides engineering services to that company's overseas customer for the construction of premises outside Australia.