Issue
Is the entity, a government authority, making a GST-free supply under section 38-110 of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act), when it assesses applications for entry into an education course?
Decision
Yes, the entity is making a GST-free supply under section 38-110 of the GST Act when it assesses applications for entry into an education course.
Facts
The entity is a government authority. The entity assesses applications that are made for entry into an education course. The entity determines which applicants are successful and advises the applicants of this. The entity receives a fee from the applicant for making the assessments.
The entity is registered for goods and services tax (GST).
Reasons for Decision
Under subsection 38-110 (1) of the GST Act, a supply is GST-free if the supply is the assessment or issue of qualifications for the purpose of: • access to education; • membership of a professional or trade association; • registration or licensing for a particular occupation; or • employment.
In this case, the entity assesses an applicant's qualifications for entry into an education course. The supply of this assessment is for the purpose of access to education and therefore, satisfies paragraph 38-110(1)(a) of the GST Act.
Subsection 38-110(2) of the GST Act provides that a supply is not GST-free under subsection 38-110(1) of the GST Act unless the supply is carried out by: • a professional or trade association; • an education institution; • an entity that is registered by a training recognition authority of a State or Territory in accordance with the Australian Recognition Framework to provide skill recognition (assessment only) services; • an authority of the Commonwealth or of a State or Territory; or • a local government body.
In this case, the supply satisfies paragraph 38-110(2)(d) of the GST Act as an authority of the Commonwealth or of a State or Territory carries out the assessment.
Therefore, the entity is making a GST-free supply under section 38-110 of the GST Act when it assesses an applicant's qualifications for entry into an education course.