GST and incontinence appliance

Is the entity, a supplier of medical aids and appliances, making a GST-free supply under subsection 38-45(1) of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act), when it supplies a device used to assist in the control of incontinence?

Yes, the entity is making a GST-free supply under subsection 38-45(1) of the GST Act when it supplies a device used to assist in the control of incontinence.

The entity is a supplier of medical aids and appliances. The entity supplies a device used to assist in the management and control of incontinence. The incontinence device is mechanically operated and is specifically designed as an incontinence control appliance for women with bladder control problems.

The device is specifically designed for people with an illness or disability and is not widely used by people without an illness or disability. There is no agreement between the entity and the recipient that the supply is not to be treated as a GST-free supply.

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

Under subsection 38-45(1) of the GST Act, the supply of a medical aid or appliance is GST-free where the medical aid or appliance: • is covered by Schedule 3 to the GST Act (Schedule 3), or specified in the A New Tax System (Goods and Services Tax) Regulations 1999 (GST Regulations); and • is specifically designed for people with an illness or disability; and • is not widely used by people without an illness or disability.

Item 20 of Schedule 3 to the GST Act (Item 20) lists 'incontinence appliances'.

The device supplied by the entity is designed to assist women with bladder control problems to maintain continence and, as such, is considered to be an incontinence appliance for the purposes of Item 20.

Additionally, the device is specifically designed for people with an illness or disability and is not widely used by people without an illness or disability. As such, the requirements in subsection 38-45(1) of the GST Act are satisfied.

Therefore, the entity is making a GST-free supply under subsection 38-45(1) of the GST Act when it supplies a device used to assist in the control of incontinence. [Note: As the supply of the incontinence device is GST-free, the importation of the device is a non-taxable importation as defined in section 13-10 of the GST Act.]