Goods and services tax: supplies of food of a kind marketed as a prepared meal

This Determination explains our view on the circumstances in which products are food of a kind 'marketed as a prepared meal'.

The supply of food of this kind is not GST-free under paragraph 38-3(1)(c) of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act) as it is food of a kind specified in column 3 of table item 4 of clause 1 of Schedule 1 to the GST Act (table item 4).

Soups are excluded from food of a kind specified in table item 4. [1] This Determination does not cover what products are 'soup'.

This Determination considers what products are food of a kind marketed as a prepared meal primarily by reference to the Federal Court's decision in Simplot Australia Pty Limited v Commissioner of Taxation [2023] FCA 1115 (Simplot).

This Determination should be read with GST Industry Issue GSTII FL1 Detailed Food List (Detailed Food List), which is a public ruling that provides our view on the goods and services tax (GST) classification of many food and beverage product lines, including under table item 4.

This Determination contains the following appendixes: • Appendix 1 sets out a method statement that explains how to apply our views in this Determination and the Detailed Food List, and includes a compliance approach to assist taxpayers in determining whether or not certain salad products are likely to be food of a kind marketed as a prepared meal. • Appendix 2 outlines our transitional compliance approach to certain categories of product for tax periods ending on or before 31 December 2025.

All legislative references in this Determination are to the GST Act, unless otherwise indicated.

Paragraph 38-3(1)(c) provides that a supply of food is not GST-free if it is food 'of a kind' specified in column 3 of the table of clause 1 of Schedule 1.

Within the category of 'Prepared food', column 3 of table item 4 specifies 'food marketed as a prepared meal, but not including soup'.

Clauses 2 and 3 of Schedule 1 provide: 2 Prepared food, bakery products and biscuit goods For the purpose of determining whether particular food is covered by any of the items in the table relating to the category of prepared food, bakery products or biscuit goods, it does not matter whether it is supplied hot or cold, or requires cooking, heating, thawing, or chilling prior to consumption. 3 Prepared meals Item 4 in the table only applies to food that requires refrigeration or freezing for its storage.

The effect of clause 2 of Schedule 1 is that a food product can be food of a kind marketed as a prepared meal regardless of 'whether it is supplied hot or cold, or requires cooking, heating, thawing or chilling prior to consumption'.

The effect of clause 3 of Schedule 1 is that food products that are not required to be stored in a refrigerator or freezer prior to opening (also known as shelf-stable products) cannot be taxable under table item 4. This applies regardless of whether they are food of a kind marketed as a prepared meal. For example, table item 4 does not apply to tins or jars of baby food, baked beans or spaghetti that, in their unopened state, do not require refrigeration or freezing.

The supply of a product that is not food of a kind marketed as a prepared meal may still be a taxable supply. Subsection 38-3(1) provides several other circumstances in which a supply of food is not GST-free. For example: • food for consumption on the premises from which it is supplied (see paragraph 38-3(1)(a)), and • hot food for consumption away from those premises (see paragraph 38-3(1)(b)).

In Simplot, the Federal Court considered the GST treatment of a range of frozen food products supplied or imported by Simplot Australia Pty Limited (Simplot Australia). The products each contained a mix of vegetables, along with spices or seasonings, and some also included grains. Some products were labelled as 'sides' and some provided express or implied serving suggestions, including through pictures that displayed the products served with added protein (for example, chicken or pork).

The Court found that all the products were food of a kind marketed as a prepared meal and therefore they were not GST-free. [2]

The Court held that the statutory test was to be approached as a single composite question, that being whether the products were food of a kind marketed as a prepared meal. [3]

Consistent with previous decisions on the meaning of 'food of a kind' in the context of GST, sales tax and customs law, the Court said that the inclusion of these words required consideration of whether the products fell within a class or genus of food that was marketed as a prepared meal. [4]

As a result, the Court held that it was necessary to consider the marketing of other products of the same kind. Following Cascade Brewery Co Pty Ltd v Commissioner of Taxation [5] (Cascade), the Court held that marketing, in this context, looks at the activities of sellers in communicating or conveying messages to the market for the promotion or sale of the product. The actual use by the consumer is not the subject of the examination. [6]

On the meaning of prepared meal, the Court in Simplot said at [124–125]: … the attributes of a "prepared meal" are to be discerned from common experience. Those attributes include: (a) quantity — a meal connotes a quantity of substance, even if it may be termed a small meal; (b) composition — a prepared meal connotes food consisting of more than one ingredient or element. Whether a combination of foods constitutes a meal is a question of fact and degree. A dish comprised solely of vegetables can be a meal. However a serving of a mix of vegetables (eg, peas and corn) may not be a meal; (c) presentation — a prepared meal connotes a combination of foods that is complete. Matters such as seasoning, sauces and flavourings may all be relevant in determining whether foods are of a kind marketed as a prepared meal. Foods of a kind marketed as a prepared meal therefore refers to foods of a sufficient quantity, mix and seasonings as to be regarded by the ordinary person as being of a kind that are marketed as a prepared meal.

Considering each of the products in this light, the Court found that in each case the products displayed attributes that made the products food of a kind marketed as a prepared meal. [7]

In determining whether a product is food of a kind marketed as a prepared meal, the statutory question is a 'single composite question' – that being, is the product food of a kind that is marketed as a prepared meal? [8]

Answering the statutory question requires considering what is meant by food being food of a kind marketed as a prepared meal, followed by an assessment of whether the product in question falls within that class or genus.

The question is not whether the product itself is marketed as a prepared meal, but whether the product is a member of a class or genus of foods that are marketed as prepared meals. [9] This means it is necessary to consider the kinds of food that are marketed as a prepared meal.

The attributes of a prepared meal and the kinds of food that are marketed as a prepared meal are to be determined by common sense and common experience. [10] This is to be determined objectively by considering the attributes of products that are marketed as prepared meals, including quantity, composition and presentation.

Whether a particular product falls within the class or genus of foods that are marketed as prepared meals cannot be determined by viewing individual attributes in isolation or without context. The test is how the product as a whole is perceived objectively, informed by common sense and common experience, and an overall consideration of its attributes. [11]

The test of 'common sense and common experience' is a composite objective judgment to be made against what is understood and observed by people generally. Application of the test depends on how reasonable people are taken to understand the attributes of the class or genus, as well as the attributes of the particular product in question. The test is not concerned with narrow perceptions or fringe views.

Whether the product in question is 'food of a kind marketed as a prepared meal' requires an overall assessment of how that product and similar ones are marketed across the food industry. [12] As a matter of common sense and common experience, how are products of that kind marketed? What do the facts and evidence tell people generally about how products of this kind are marketed by entities in the food industry, including supermarkets, grocery stores, food courts, takeaway outlets, cafés and restaurants?

The words 'of a kind' are words of expansion rather than limitation. They have the effect that the question is not whether the product is the particular item of food specified in column 3 of the table in Schedule 1, but whether the product is a member of a class or genus of food of the item specified. [13] In this case, the question is whether the product is a member of a class or genus of foods that are marketed as prepared meals.

A product may be of a kind marketed as a prepared meal even if it does not share all of the attributes of food of that kind. For example, in Simplot, the Court found that the use of cauliflower as a substitute for rice did not prevent the relevant 'VeggieRice' products from having the character of fried rice or risotto. [14]

Equally, a product is not of a kind marketed as a prepared meal merely because it is an ingredient or component of food of that kind. For example, many prepared meals include peas, but frozen peas (on their own) are not food of a kind marketed as a prepared meal. Being of the same kind requires more than just having a common ingredient.

In determining whether a product is of a kind marketed as a prepared meal, it does not matter whether the product may also be of some other kind. [15] For example, in Simplot, the fact that the products could be described as food marketed as a meal component or side dish did not mean they could not also be food of a kind that is marketed as a prepared meal. [16]

Similarly, the fact that a product is marketed as a snack does not mean it could not also be food of a kind marketed as a prepared meal. Determining whether a product is a side dish, meal component or snack will not assist in answering the statutory question, which is whether the product is food of a kind marketed as a prepared meal.

In determining whether a product is food of a kind marketed as a prepared meal, it is necessary to consider the kinds of food that are marketed as a prepared meal. The marketed use of a product is to be determined objectively, having regard to what a reasonable observer would understand from the content of the marketing. [17]

The marketing of a product involves the end-to-end process where products are put onto the market. This includes promotional and sales activities. [18] The content of the marketing is what those activities objectively convey to the market. [19]

Marketing includes labelling (including the name), packaging, display, product placement, promotion and advertising. [20] Marketing does not include internal activities of the seller, nor is it determined by the subjective intention or motivation of the seller. These things do not convey any message to the market. [21]

Marketing of food products can occur at different points across the supply chain. The activities of all suppliers in the supply chain will be relevant, including the manufacturer, importer, wholesaler and retailer in each case. The marketing activities carried out by competitors in the market are also relevant to identifying the class or genus of products marketed as a prepared meal. Where there is no change in a product across the supply chain, the product will have the same GST treatment under table item 4 (whether sold at the wholesale or retail level).

The statutory question is not whether the product itself is marketed as a prepared meal. If a product is of the same kind as food that is marketed as a prepared meal, it does not matter if its own marketing does not represent it as a prepared meal. [22]

While it is not determinative, the marketing of the product itself remains relevant. [23] Where a product is marketed as a prepared meal, this is a strong indicator that the product is food of a kind marketed as a prepared meal.

Whether a product is, in fact, marketed as a prepared meal cannot be determined by looking at individual aspects of the product's marketing in isolation. For example, a chicken cordon bleu product may be described on its packaging as being 'perfect for dinner', but this alone does not mean the product is being marketed as a prepared meal. On the other hand, a macaroni and cheese product that is described as 'All you need for dinner' and is designed to be heated and eaten directly from the packaging is being marketed as a prepared meal.

While a product's own marketing may be a strong indicator that a product is food of a kind marketed as a prepared meal, it is not determinative. It is still necessary to consider the other attributes of the product. For example, if a product is not of a sufficient quantity for a meal or is not sufficiently prepared, it will not be food of a kind marketed as a prepared meal.

The test does not require that food of the relevant kind be solely or principally marketed as a prepared meal. However, as the Court in Simplot emphasised, application of the statutory test must be informed by common sense and common experience. [24]

In applying this test, it is not appropriate to have regard to obscure or isolated incidences when determining whether a product is food of a kind marketed as a prepared meal. For example, an isolated instance of a plain yoghurt product being marketed as a prepared meal would not result in that product, or all plain yoghurts, becoming food of a kind marketed as a prepared meal.

In Simplot, the Court held that prepared meal took its ordinary meaning read in context. [25] The Court held that the attributes of a 'prepared meal' are to be determined from common sense and common experience and include considerations of quantity, composition and presentation. [26]

For a product to be food of a kind marketed as a prepared meal, it is not necessary for it to be: • called a 'prepared meal' • marketed for consumption on a particular occasion such as breakfast, lunch or dinner • packaged and described as a single serving, or • designed to be consumed directly out of its packaging. [27]

A product may be food of a kind marketed as a prepared meal while also being food of a kind marketed as a meal component or snack. [28] However, in practice, many meal components and snacks will not possess the necessary attributes that would make them food of a kind marketed as a prepared meal.

A product will be food of a kind marketed as a prepared meal if it is the kind of food that, as a matter of common sense and common experience, is marketed as a prepared meal. This is determined objectively by considering the attributes of the product, including quantity, composition and presentation.

Each attribute is considered in further detail in paragraphs 48 to 66 of this Determination.

In Simplot, the Court held that a meal involves a 'quantity of substance'. [29]

The following considerations are relevant regarding the quantity of a product: • The product need not be a substantial or big meal – a light or small meal is still a meal. • What will be a 'quantity of substance' will vary based on the product in question. • Products that are presented as being for consumption by a particular group (for example, babies and children) or that is commonly consumed on a particular occasion (for example, breakfast) need to be considered in light of that context. A quantity of food may be of sufficient quantity when presented as a meal for infants, even if the same quantity might not be sufficient as a meal for adults. • The product may be marketed as a snack, or a kind of food that can be eaten as a snack, and still be food of a kind that is marketed as a prepared meal. • The product may be supplied in large quantities and may still be food of a kind marketed as a prepared meal. [30] There is no upper threshold on quantity. See Example 1 of this Determination.

The degree to which quantity is relevant may also depend on the form in which the product is sold. Some products are commonly sold in a way that the consumer is able to choose or measure the amount they purchase (for example, sushi or some salads sold at a delicatessen). In these circumstances, the quantity or weight chosen or measured will be of little relevance in determining whether the product is food of a kind marketed as a prepared meal.

As a matter of common sense and common experience, a product is not food of a kind marketed as a prepared meal unless it is of a sufficient quantity for a meal. This will depend on the facts.

The question is whether the total product is a sufficient quantity. This is not impacted by the recommended serving size described on the packaging or by individually wrapped portions or components within the product. It is the total weight of the product, as outlined on its label that is relevant. [31]

Based on our review of products in the market, we consider that products of less than 150 grams in total weight will not be a sufficient quantity for a meal and are not food of a kind marketed as a prepared meal. However, this does not apply to products that are sold in situations where the consumer may choose or measure the amount they purchase. See paragraph 50 of this Determination.

In Simplot, the Court held that a prepared meal involves food consisting of more than one ingredient or element. [32] A product is more likely to be food of a kind marketed as a prepared meal where it is made from multiple ingredients or elements. It is a matter of fact and degree whether a particular combination of ingredients or elements constitutes a meal.

It is necessary to consider the nature of the ingredients or elements and not simply the number of ingredients or elements. [33] A product that includes some combination of protein, vegetables or a grain product (for example, pasta, rice or bread) is more likely to be of a kind marketed as a prepared meal.

The composition of a product may also indicate its suitability to be eaten at a particular meal occasion. For example, products containing cereal or muesli are generally consumed for breakfast and are commonly marketed as breakfast foods (see Example 2 of this Determination). On the other hand, products containing custard, jelly and cake are generally consumed for dessert and are not a kind of food that is marketed as a prepared meal (see Example 4 of this Determination).

In practice, applying common sense and common experience involves considering whether the product has a similar composition to products sold as a prepared meal by entities in the food industry. For example, in Simplot, the Court characterised the products as pasta in sauce, risotto or fried rice and observed that these types of foods are, as a matter of common sense and common experience, foods of a kind marketed as a prepared meal. [34]

In Simplot, the Court also held that a prepared meal involves a combination of foods that is 'complete'. [35] This attribute was referred to as 'presentation'. A product's presentation will indicate it is food of a kind marketed as a prepared meal if it is presented as being complete. Being 'complete', in this context, involves both the degree of preparation and whether the product is supplied with all necessary inclusions to be a complete 'meal'.

First, the product should be 'complete' in the sense of being prepared and should require only limited further preparation, assembly or activity by the consumer. When determining whether a product is 'complete', the following principles are relevant: • If a product is sold fully assembled, the fact that all or part of it may be raw does not prevent it from being sufficiently prepared, even if it requires cooking before consumption. • If cooking or heating is required for the product to be ready for consumption, this should only require limited activity by the consumer, such as cooking or heating in a microwave, oven, frying pan or saucepan. Simply heating a product and stirring regularly during the process will not mean, by itself, that the product is not sufficiently prepared. This will apply even where these activities are required to complete the cooking process for a partly cooked product. See Example 5 of this Determination. • Where a product requires one of the following actions by the consumer, particularly where more than one of these is required, this may point to a conclusion that the product is not sufficiently prepared - chopping, peeling, or otherwise preparing the ingredients - cooking different ingredients or elements separately or using different methods, or - cooking a product which contains raw ingredients where this requires active involvement of the consumer. Active involvement includes actions like stirring, monitoring, adjusting temperature, and the staged addition of different ingredients. See Example 6 of this Determination. • Some products, including sushi and salad products, are ready for consumption when sold even though part of them may be raw. • Sometimes a single product is sold with some or all of the ingredients or elements separated from each other. The fact that a consumer needs to combine the ingredients or elements before consumption of itself does not mean that the product is not sufficiently prepared to be 'complete'. For example, a product will be sufficiently prepared if all the consumer needs to do is combine various salad ingredients or elements and dress the salad with a provided sachet of dressing (see Example 11 of this Determination).

Second, the product should be presented as being 'complete' in the sense of being a complete meal. Whether a product is presented as a complete meal is a matter of fact and degree.

Where a product includes all required seasonings, sauces or flavourings, this is an indicator that the product is presented as complete. Recommendations or instructions to add water or oil when cooking or heating do not mean that the product is not sufficiently prepared or complete.

A serving suggestion on the packaging of a product, while a relevant aspect of the product's marketing, is not determinative of whether it is presented as being complete. The products in Simplot were considered to be sufficiently complete, for the purpose of table item 4, even though they contained suggestions that they be served with the addition of protein (for example, chicken or fish). Similarly, a stew or casserole product may be sufficiently complete even though the product contains a suggestion that it be served with rice or other accompaniment.

A product may be presented, including by its own marketing, as a kind of food that is commonly eaten: • on its own as a complete meal (for example, it may be presented as fried rice or risotto) • as a meal component only (for example, it may be presented as mashed potato or chicken kiev) • as an appetizer (for example, it may be presented as spring rolls, curry puffs, samosa, arancini balls, croquettes, calamari rings, prawn cutlets or devilled eggs).

A product that is presented as a kind of food that is commonly eaten as a meal component only, or as an appetizer, will generally not be food of a kind marketed as a prepared meal (see Example 7 of this Determination).

In some cases, specific aspects of a product's presentation, including its own marketing, will strongly indicate that it is food of a kind marketed as a prepared meal. Products that are a kind of food that is generally served with rice or other accompaniment (for example, curry products) may be marketed as being a complete meal on their own. This will strongly indicate that the product is food of a kind marketed as a prepared meal.

As a further example, an appetizer or similar small plate dish (for example, dumplings) may be presented as being a complete meal that can be heated and eaten straight from the packaging. These are attributes that are relevant to the overall assessment of the product and will strongly indicate that the product is food of a kind marketed as a prepared meal (see Example 8 of this Determination).

A 'salad' is ordinarily understood as a cold dish of various mixtures of raw or cooked foods, particularly vegetables, usually seasoned and dressed with oil, vinegar or other dressing.

Salads are a broad category of food that includes some products that are marketed as prepared meals and others that are not marketed as prepared meals.

A salad product will be food of a kind marketed as a prepared meal if it is the kind of salad product that, as a matter of common sense and common experience, is marketed as a prepared meal by entities in the food industry. This is to be determined objectively by considering the attributes of salad products that are marketed as prepared meals (including quantity, composition, and presentation) and those of the product itself.

Some kinds of salad products are readily recognisable, as a matter of common sense and common experience, as being commonly marketed as a prepared meal, even if the precise composition and presentation vary from product to product – for example, Caesar salad. Other kinds of salad product are readily recognisable as not being marketed in this way – for example, coleslaw.

Between these 'readily recognisable' categories, there is a wide variety of salad products supplied across the food industry. Where a salad product does not fall within one of these categories, it is necessary to consider the attributes of the product (particularly its composition and presentation) and determine whether it is sufficiently similar to the kinds of salad products that are commonly marketed as a prepared meal.

Generally, the kinds of salad products that are marketed as a prepared meal contain a variety of ingredients, a balanced proportion of ingredients and a sufficient overall quantity to constitute a meal. Salad products with these attributes are the kind that are commonly marketed as complete meals to be eaten on their own.

Salad products that lack variety and a balance of ingredients are less likely to be food of a kind marketed as a prepared meal. This is a question of fact and degree.

Table 1 of this Determination identifies common attributes that can indicate whether or not a salad product is food of a kind marketed as a prepared meal. Table 1: Attributes that can indicate whether or not a salad product is or is not food of a kind marketed as a prepared meal Attributes that indicate a salad product is not food of a kind marketed as a prepared meal Attributes that indicate a salad product is food of a kind marketed as a prepared meal The salad product: • has a high proportion of one ingredient (or category of ingredient [36] ) with insignificant amounts of others • has a limited number of different ingredients (or categories of ingredient). The salad product: • contains a variety of ingredients in balanced proportions • contains a more than insignificant meat or seafood component • contains instructions for heating (even if heating is optional) • is sold as a single serving • is sold in a bowl or similar container from which it is designed to be eaten • is sold in a dine-in or takeaway environment such as a food court or café.

Paragraphs 76 to 105 of this Determination provide examples illustrating our view on how the law applies in practice. [37]

Wholesaler Ltd sells frozen beef lasagne in a range of sizes, including 5 kg and 10 kg trays.

While the lasagne trays are not pre-portioned and are provided in quantities that are more than what one person would be expected to consume as a meal, neither of these factors affect whether they are food of a kind marketed as a prepared meal.

The lasagne trays have the attributes of a prepared meal, including sufficient quantity, composition and presentation. As a matter of common sense and common experience, lasagne is a kind of food that is marketed as a prepared meal.

The lasagne trays are food of a kind marketed as a prepared meal.

Manufacturer Ltd makes and sells pots of bircher muesli containing rolled oats soaked in yoghurt and apple juice, coconut flakes and raisins. The pots weigh 150 grams.

The pots of bircher muesli have the attributes of a prepared meal, including sufficient quantity, composition and presentation. In particular, the composition of the product indicates its suitability to be eaten at breakfast. As a matter of common sense and common experience, bircher muesli is a kind of food that is marketed as a prepared meal (a complete breakfast).

The pots of bircher muesli are food of a kind marketed as a prepared meal.

Retailer Ltd sells a range of frozen food products, including a frozen mashed potato product. This product comes with 2 pre-portioned packets of 200 grams each and instructions for heating the packets in the microwave, either separately or together.

The product's composition is not consistent with that of a prepared meal as it comprises only one element. While mashed potato is a component in meals, as a matter of common sense and common experience, a product composed solely of mashed potato (or solely of mashed potato, butter and seasonings) is not a kind of food that is marketed as a prepared meal.

The frozen mashed potato product is not food of a kind marketed as a prepared meal.

Importer Ltd imports a range of chilled desserts, including a product called 'Not Just a Trifle'. The trifle contains a wide range of ingredients including cream, custard, strawberries, grapes, pears, mango, pomegranate seeds, raw almonds, raw pistachios, jelly, sponge cake and sherry.

While the trifle includes many different ingredients, the nature of these ingredients, when combined, mean that the composition of the product is not consistent with that of a prepared meal but rather is that of a dessert. A dessert may be part of a meal or a course in itself but it is not a meal.

As a matter of common sense and common experience, trifle is not a kind of food that is marketed as a prepared meal.

The trifle is not food of a kind marketed as a prepared meal.

Manufacturer Ltd makes and sells a frozen pasta product containing chicken, vegetables, pasta and sauce. The product is sold in a 400-gram bag and has been partly cooked. The instructions on the bag say that the product should be: • microwaved in a covered microwave-safe container on high for 6 minutes, stirred and microwaved for a further 4 minutes, or • cooked in a covered pan on the stove-top for 15 minutes, stirring as necessary.

The pasta product has the attributes of a prepared meal, including sufficient quantity, composition and presentation. As a matter of common sense and common experience, pasta in sauce with chicken and vegetables is a kind of food that is marketed as a prepared meal.

While the pasta product is not fully cooked at the point of sale, this does not prevent it from being sufficiently prepared. Completion of the cooking process can be achieved by alternate methods, both of which constitute limited further preparation and activity by the consumer as the product is partly cooked at the point of sale.

The pasta product is food of a kind marketed as a prepared meal.

Wholesaler Ltd sells meal preparation kits that contain all the ingredients necessary to make a meal. Each kit is accompanied by step-by-step cooking directions. The Chicken Stir-Fry kit comes with raw chicken, fresh chopped vegetables and a packet of sauce.

The product's presentation is not consistent with that of a prepared meal as it is not presented as complete. Even though the product is prepared to some degree and contains all the necessary ingredients for a meal, the ingredients require more than limited preparation, assembly and activity by the consumer before consumption. The chicken and vegetables are raw and cooking the product requires active involvement of the consumer, including stirring, monitoring, adjusting temperature and the staged addition of different ingredients to ensure the meal is fully cooked.

As a matter of common sense and common experience, a product containing raw chicken, fresh chopped vegetables, and a packet of sauce is not a kind of food that is marketed as a prepared meal.

The Chicken Stir-Fry kit is not food of a kind marketed as a prepared meal.

Importer Ltd imports and sells a refrigerated food product that contains beef meatballs in a tomato and herb sauce. The product is 800 grams and the packaging indicates it serves 4 people. The packaging provides instructions for heating in the oven or microwave.

While the product is a sufficient quantity for a meal, its composition and presentation are not consistent with that of a prepared meal. The product has only 2 components, being meatballs and a sauce and is a kind of food that normally requires the addition of pasta, rice or similar additional component to be a complete meal. It is presented as a kind of food that would commonly be included as part of a meal, but is not presented as a kind of food that would be eaten on its own as a complete meal.

As a matter of common sense and common experience, the presentation of the product, the nature of the components and their limited number mean that it is not a kind of food that is marketed as a prepared meal.

The product is not food of a kind marketed as a prepared meal.

In its refrigerated section, Retailer Ltd sells Easy Dumplings that contain 4 vegetable and 4 prawn dumplings in a microwavable container. The product weighs 250 grams. The product comes with a sachet of soy sauce.

The product has the attributes of a prepared meal, including quantity, composition and presentation. While not all products containing dumplings are food of a kind marketed as a prepared meal, this product is of a sufficient quantity and composition for a meal and is presented as being a complete meal that can be heated and eaten straight from the packaging.

As a matter of common sense and common experience, products packaged and presented this way, are food of a kind marketed as a prepared meal.

The Easy Dumplings product is food of a kind marketed as a prepared meal.

This Determination applies both before and after its date of issue. However, the Determination does not apply to you to the extent that it conflicts with the terms of settlement of a dispute agreed to before the date of issue of the Determination (see paragraphs 75 to 76 of Taxation Ruling TR 2006/10 Public Rulings).

We will continue to act in accordance with Law Administration Practice Statements PS LA 2011/27 Determining whether the ATO's views of the law should be applied prospectively only and PS LA 2012/2 (GA) GST classification of food and beverage items.

The 4-step method in this Appendix sets out the process to follow to determine whether a product is food of a kind marketed as a prepared meal. It contains a compliance approach for certain salad products in Step 3. [38]

We have developed the compliance approach in Step 3 as an option to assist taxpayers in determining whether or not certain salad products are likely to be food of a kind marketed as a prepared meal. Where a salad product meets the criteria in the compliance approach: • We consider there to be a low risk that the salad product will be food of a kind marketed as a prepared meal. • We will not have cause to apply compliance resources to review whether the salad product is food of a kind marketed as a prepared meal. However, we may choose to check compliance with this approach.

The 4-step method is also outlined in the flow chart at paragraph 132 of this Determination.

If the product is not a sufficient quantity for a meal (see paragraph 53 of this Determination): • the product is not food of a kind marketed as a prepared meal, and • it is not necessary to proceed to Steps 2 to 4 of this table.

Otherwise, proceed to Step 2.

The Detailed Food List provides our view on the GST classification of certain readily recognisable kinds of products that are, or are not, food of a kind marketed as a prepared meal.

Due to the wide variety of food products supplied across the food industry, it is not possible to exhaustively list all the different kinds of products on the Detailed Food List.

A product is considered to be 'covered by the Detailed Food List' if the item description of an entry on the Detailed Food List accurately describes the product (see Examples 9 and 10 of this Determination). Except where the item description in the Detailed Food List indicates to the contrary, it is assumed that: • the product is not supplied as a dine-in or hot takeaway food item, and • where table item 4 applies, the product weight is 150 grams or more. [39]

If a product is covered by the Detailed Food List: • you can refer to Detailed Food List for our view on the GST classification of that product • you cannot apply the compliance approach in Step 3 to that product, even if it is a salad product, and • it is not necessary to proceed to Step 4.

If a product is not covered by the Detailed Food List, proceed to Step 3.

Step 3 provides a compliance approach for determining whether certain salad products have a sufficient variety of ingredients in sufficiently balanced proportions to be food of a kind marketed as a prepared meal.

This compliance approach does not apply if the salad product: • contains a meat or seafood component that is 10% or more of the total weight of the product • contains instructions for heating (even if heating is optional) • is sold as a single serving [40] in a pre-packaged container, or • is sold in a dine-in or takeaway environment such as a food court or café.

This compliance approach applies to salad products that are not covered by the Detailed Food List (see Step 2) and have any of the following attributes: • 70% or more of the total product by weight is a single ingredient or category of ingredient, being pasta, rice or other grain • 60% or more of the total product by weight is a single ingredient or category of ingredient, being anything other than pasta, rice or other grain, or • the product contains 3 or fewer different ingredients or categories of ingredient, excluding - dressing, oil, water, sugar, salt, seasoning, herbs (dried or fresh), alliums [41] or similar type of ingredient, and - preservatives, thickeners, acidity regulators or similar type of ingredient.

In this context, we use the phrase 'category of ingredient' to refer to very similar ingredients or ingredients that are commonly included together. For the purpose of considering whether a salad product has any of these attributes, we consider it appropriate that: • different varieties of what is essentially the same ingredient be treated as a single 'category of ingredient' (for example, white rice and brown rice, cherry and grape tomatoes, and different types of pulses [42] ) • the following ingredients be treated (all together) as a single 'category of ingredient' – leafy greens [43] , raw root vegetables [44] and alliums • all other ingredients be counted separately.

Where a salad product meets the criteria in this compliance approach: • we consider there to be a low risk that the salad product will be food of a kind marketed as a prepared meal • we will not have cause to apply compliance resources to review whether the salad product is food of a kind marketed as a prepared meal; however, we may choose to check compliance with this approach.

If a salad product's label complies with labelling requirements under Australian law, you can rely on the list of ingredients on the label to determine whether the product meets the criteria in this compliance approach. This applies to identifying what the ingredient is and also its percentage weight within the total product.

While the salad product's label will generally be the primary source of the required information, you are not restricted to relying solely on this information. You may rely on any further information or evidence available to you. [45]

If a salad product is assessed to be low risk, you must keep records of any information or evidence relevant to determining that the salad product meets the criteria in this compliance approach.

Minor changes to a product (including seasonal variations to ingredients) will not affect whether a salad product meets the criteria in this compliance approach, provided the variation does not require a change to the product label under Australian law.

Where a minor change or seasonal variation to a product's ingredients requires a change to the product label under Australian law, you should reassess whether the product continues to meet the criteria in this compliance approach. You can do this either through your on-boarding process for new products or by conducting an annual review of the products previously determined to be low risk under this compliance approach.

Products assessed as low risk, including those that are not required under Australian law to have a list of ingredients on their product label, should be reviewed annually to ensure they continue to meet the criteria in this Appendix.

For salad products that do not meet the criteria in this compliance approach, proceed to Step 4.

For any products where Steps 1 to 3 do not assist with the GST classification of the product under table item 4, the general principles as outlined in this Determination should be applied to determine whether the product is food of a kind marketed as a prepared meal.

While not exhaustive, we consider that Steps 1 to 3 will identify most salad products that are not food of a kind marketed as a prepared meal. Any salad products where Steps 1 to 3 do not assist with GST classification of the product under table item 4 are highly likely to be food of a kind marketed as a prepared meal.

This flow chart summarises the 4-step method to assist taxpayers in determining whether a product is food of a kind marketed as a prepared meal. This includes a compliance approach in Step 3 for certain salad products. Diagram 1: Summary of the 4-step method

Paragraphs 134 to 180 of this Determination provide examples illustrating how our compliance approach can assist in determining whether certain salad products are likely to be food of a kind marketed as a prepared meal.

Retailer Ltd sells pre-packaged potato salad tubs (containing potato, egg, herbs and dressing) in various sizes, including 250-gram and 500-gram tubs. Retailer Ltd also sells the same potato salad from large trays behind its deli counter, where customers can select the amount they wish to purchase in a tub. Step 1

The 250-gram and 500-gram pre-packaged potato salad tubs are sold in a sufficient quantity for a meal.

As the consumer is able to choose or measure the amount of the potato salad they purchase from the deli counter, the amount chosen or measured is of little relevance in determining whether the product is food of a kind marketed as a prepared meal. Step 2

The potato salad products are covered by the Detailed Food List as the item description of Detailed Food List entry accurately describes the products.

As the potato salad products are covered by the Detailed Food List: • the compliance approach for certain salad products in Step 3 of this Appendix does not apply to the product, and • it is not necessary to proceed to Step 4.

The potato salad products, whether sold in pre-packaged tubs or from behind the deli counter, are not food of a kind marketed as a prepared meal.

Wholesaler Ltd sells a potato salad product in 300-gram tubs. The nutritional information panel states the potato salad product serves 2 people. This potato salad product contains the same ingredients as the potato salad in Example 9 of this Determination but also contains cheese. Step 1

The potato salad product is a sufficient quantity for a meal. Step 2

The potato salad product is not covered by the Detailed Food List. The item description of Detailed Food List entry does not accurately describe the product and there are no other relevant entries. Step 3

The potato salad product: • is not covered by the Detailed Food List • does not have any of the attributes described at paragraph 119 of this Determination, and • has one of the attributes described at paragraph 120 of this Determination as it contains only 3 ingredients or categories of ingredient – potato, egg and cheese (herbs and dressing are excluded).

Accordingly, the potato salad product meets the criteria in the compliance approach in Step 3 of this Appendix. We will not have cause to apply compliance resources to review whether the potato salad product is food of a kind marketed as a prepared meal.

It is not necessary to proceed to Step 4.

Manufacturer Ltd makes and sells a Caesar salad kit containing bacon pieces, shaved parmesan cheese, croutons, cos lettuce and a sachet of dressing. The product weighs 200 grams. The different components are contained in separate internal packaging inside the outer bag and need to be combined before eating. Step 1

The Caesar salad kit is a sufficient quantity for a meal. Step 2

The Caesar salad kit is covered by the Detailed Food List as the item description of Detailed Food List entry accurately describes the product.

As the Caesar salad kit is covered by the Detailed Food List: • the compliance approach for certain salad products in Step 3 of this Appendix does not apply to the product, and • it is not necessary to proceed to Step 4.

The Caesar salad kit is food of a kind marketed as a prepared meal.

Retailer Ltd sells a Mediterranean salad kit containing mixed leafy greens (65%), chickpeas (10%), roasted capsicum (10%), fetta (5%) and a sachet of dressing (10%). The product weighs 200 grams and is packaged in a bag that serves 2. Step 1

The Mediterranean salad kit is a sufficient quantity for a meal. Step 2

The Mediterranean salad kit is not covered by the Detailed Food List as there is no Detailed Food List entry that accurately describes the product. Step 3

The Mediterranean salad kit: • is not covered by the Detailed Food List • does not have any of the attributes described at paragraph 119 of this Determination, and • has one of the attributes described at paragraph 120 of this Determination, as a single ingredient or category of ingredient (mixed leafy greens) makes up 60% or more of the total product by weight.

Accordingly, the Mediterranean salad kit meets the criteria in the compliance approach in Step 3 of this Appendix. We will not have cause to apply compliance resources to review whether this Mediterranean salad kit is food of a kind marketed as a prepared meal.

It is not necessary to proceed to Step 4.

Retailer Ltd also sells another Mediterranean salad kit with a different composition to the product described in Example 12 of this Determination. This Mediterranean salad kit contains mixed leafy greens (45%), chickpeas (15%), roasted capsicum (10%), fetta (10%), olives (10%) and a sachet of dressing (10%). The product weighs 200 grams and is packaged in a bag that serves 2. Step 1

The Mediterranean salad kit is a sufficient quantity for a meal. Step 2

The Mediterranean salad kit is not covered by the Detailed Food List as there is no Detailed Food List entry that accurately describes the product. Step 3

The Mediterranean salad kit: • is not covered by the Detailed Food List, and • does not have any of the attributes described at paragraph 119 of this Determination.

Accordingly, the compliance approach in Step 3 of this Appendix can be applied to the Mediterranean salad kit.

However, the Mediterranean salad kit does not have any of the attributes described at paragraph 120 of this Appendix as: • there is no single ingredient or category of ingredient that makes up 70% or 60% (as relevant) or more of the total product by weight, and • it contains more than 3 different ingredients or categories of ingredient (taking into account the relevant exclusions).

Accordingly, this Mediterranean salad kit does not meet the criteria for the compliance approach in Step 3 of this Appendix. Step 4

This Mediterranean salad kit has all the attributes of a prepared meal, including sufficient quantity, composition and presentation. It contains a variety of ingredients, a balanced proportion of ingredients, and is of a sufficient overall quantity for a meal.

As a matter of common sense and common experience, this Mediterranean salad kit is a kind of food that is commonly marketed as a complete meal to be eaten on its own.

This Mediterranean salad kit is food of a kind marketed as a prepared meal.

Wholesaler Ltd sells a Mediterranean lamb salad bowl containing mixed leafy greens (50%), roasted lamb strips (15%), chickpeas (10%), roasted capsicum (10%), fetta (5%), and a sachet of dressing (10%). The product weighs 280 grams and is packaged in a bowl as a single serving. Step 1

The Mediterranean salad bowl is a sufficient quantity for a meal. Step 2

The Mediterranean salad bowl is not covered by the Detailed Food List as there is no Detailed Food List entry that accurately describes the product. Step 3

The Mediterranean salad bowl has 2 of the attributes described at paragraph 119 of this Determination. It contains a meat component that is 15% (10% or more) of the total weight of the product. It is also sold as a single serving in pre-packaged container. Accordingly, the compliance approach in Step 3 of this Appendix does not apply to the product. Step 4

The Mediterranean salad bowl has all the attributes of a prepared meal, including sufficient quantity, composition and presentation. It contains a variety of ingredients, a balanced proportion of ingredients, and is of a sufficient overall quantity for a meal.

As a matter of common sense and common experience, the Mediterranean salad bowl is a kind of food that is commonly marketed as a complete meal to be eaten on its own.

The Mediterranean salad bowl is food of a kind marketed as a prepared meal. Note: in this case, the product has 2 of the attributes described at paragraph 119 of this Determination. However, the presence of any one of the attributes means that the compliance approach in Step 3 of this Appendix does not apply to the product.

Retailer Ltd sells a Mediterranean lamb salad with the same composition as in Example 14 of this Determination from large trays behind its deli counter. The Mediterranean lamb salad is scooped up into in a container and the customer is charged based on the weight purchased. Step 1

As the consumer is able to choose or measure the amount of the Mediterranean lamb salad they purchase from the deli counter, the amount chosen or measured is of little relevance in determining whether the product is food of a kind marketed as a prepared meal. Step 2

The Mediterranean lamb salad is not covered by the Detailed Food List as there is no Detailed Food List entry that accurately describes the product. Step 3

The Mediterranean lamb salad has 1 of the attributes described at paragraph 119 of this Determination. It contains a meat component that is 15% (10% or more) of the total weight of the product. Accordingly, the compliance approach in Step 3 of this Appendix does not apply to the product. Step 4

The Mediterranean lamb salad has all the attributes of a prepared meal, including sufficient quantity, composition and presentation. It contains a variety of ingredients, a balanced proportion of ingredients, and is of a sufficient overall quantity for a meal.

As a matter of common sense and common experience, the Mediterranean salad is a kind of food that is commonly marketed as a complete meal to be eaten on its own.

The Mediterranean lamb salad sold from the deli counter is food of a kind marketed as a prepared meal. Note: bulk packages of the same Mediterranean lamb salad sold by a manufacturer or wholesaler to Retailer Ltd to sell from their deli are also food of a kind marketed as a prepared meal.

Some of the views set out in this Determination are not fully aligned with our past practice and public advice and guidance. [46]

We are adopting a transitional compliance approach to certain categories of product, being: • salad products (but not those sold in a dine-in or takeaway environment such as a food court or café) • prepared meal products that require assembly, and • chicken wraps – uncooked.

If you have treated the supply of these products as GST-free in good faith, we will not have cause to devote compliance resources to reviewing their GST treatment under table item 4 for tax periods ending on or before 31 December 2025 (subject to paragraphs 184 to 185 of this Determination).

This transitional compliance approach will not apply if: • you take action to change your prior treatment of these products by now claiming input tax credits for acquisitions of the products that, at the time, you understood were supplied to you GST-free (see paragraph 185 of this Determination for further information) • there is evidence of avoidance, fraud or evasion, or • you otherwise take inappropriate advantage of the transitional compliance approach.

If you take action to now claim input tax credits on your acquisitions of the products, not only will the transitional compliance approach not apply to you, you will also need to review your on-supply of the products and remit the GST payable on those taxable supplies.

If you intend to make changes to your GST treatment of supplies or acquisitions of for past periods, you should also consider: • the potential effect of Division 142 (refer to Goods and Services Tax Ruling GSTR 2015/1 Goods and services tax: the meaning of the terms 'passed on' and 'reimburse' for the purposes of Division 142 of the A New Tax System (Goods and Services Tax) Act 1999) • the requirement to hold a tax invoice (refer to Goods and Services Tax Ruling GSTR 2013/1 Goods and services tax: tax invoices which sets out the information requirements for tax invoices).