Issue
Is the entity, a supplier of goods, making a supply on or after 1 July 2000 as determined by subsection 6(2) of the A New Tax System (Goods and Services Tax Transition) Act 1999 (Transition Act), when it makes goods available to a recipient on or after 1 July 2000, for which consideration is received prior to 1 July 2000?
Decision
Yes, the entity is making a supply of goods on or after 1 July 2000 as determined by subsection 6(2) of the Transition Act, when it makes goods available to a recipient on or after 1 July 2000, for which consideration is received prior to 1 July 2000.
Facts
The entity is a supplier of goods. The entity receives consideration for the sale of the goods prior to 1 July 2000. The entity does not make the goods available to the recipient until on or after 1 July 2000.
The entity is registered for goods and services tax (GST).
Reasons for Decision
Section 6 of the Transition Act sets out how to determine when a supply or acquisition is made for the purposes of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act).
Subsection 6(2) of the Transition Act states that a supply or acquisition of goods is made: • when the goods are removed; • if the goods are not to be removed - when the goods are made available to the recipient; or • if the goods are removed before it is certain that a supply will be made (for example, if the goods are given or taken on approval, sale or return, or similar terms) - when it becomes certain that a supply has been made.
The entity receives full consideration, prior to 1 July 2000, for goods that are not made available to the recipient until on or after 1 July 2000. The supply of the goods is deemed to be when the goods are made available to the recipient, which in this case, is on or after 1 July 2000. As such, as determined by subsection 6(2) of the Transition Act, the entity is making a supply of goods on or after 1 July 2000. [NOTE: The supply is a taxable supply where the entity is registered for GST and the supply satisfies the other positive limbs of section 9-5 of the GST Act and the supply is neither GST-free under Division 38 of the GST Act nor input taxed under Division 40 of the GST Act.]