Private ruling: GST and care services in Serviced Apartments
Date of advice: 19 August 2016
Published: September 2016

Ruling: Q1: Are your supplies of the Serviced Apartment Services to Residents requiring care services, GST-free supplies in accordance with section 38-25(3) of the GST Act? | A1: Yes: • The apartments meet the requirements of serviced apartments • there is in force a written agreement under which the operator of the retirement village provides daily meals and heavy laundry services to all of the residents of a particular apartment, services supplied to the residents of the particular apartment will be supplied in a residential setting • New residents moving into a Serviced Apartment are required to have a medical assessment completed by their local medical practitioner • The care services are only supplied to residents who have been assessed as requiring on-going care in accordance with paragraphs (d), (e) and (f) of Item 2.1 of Part 2 of Schedule 1 to the Quality of Care Principles • The services are supplied under a written agreement (being the Residence Contract), which includes a package of: • the required services under item 2.1 • other services that may be needed by Residents, and • accommodation. Therefore, your supply of "Serviced Apartment Services" to a Serviced Apartment resident will be GST free. | Q2: Is your supply of accommodation to Residents requiring care services in the Serviced Apartments a GST-free supply in accordance with section 38-25(4A)(b) of the GST Act? | A2: Yes: • Residents have been assessed as requiring the 2.1 or 3.8 services, and • There is in place a written agreement under which the operator of the Retirement Village provides daily meals and heavy laundry services to all of the residents of the particular apartment. Therefore, your supply of accommodation to a resident of a Serviced Apartment will be GST free.

Relevant facts and circumstances: You own and operate the Retirement Village ("Village") at XXXX. The Village The Village is comprised of independent living units and serviced apartments (Serviced Apartments). The Serviced Apartments may be configured as either a "studio" or "one bedroom". The accommodation within the Village is intended for retired persons over the age of 55. The communal facilities within the Village include: • Community Hall • All weather bowling rink • Half Court Tennis • Library Room • Medical room (by appointment) and • Hairdressing room (by appointment) The Serviced Apartments Couples, as well as individuals, can occupy a serviced apartment. All serviced apartments are in the one building and under the same roof. The apartments are connected via internal corridors. The Serviced Apartment Complex has also been designed to maximise the safety and mobility of Residents. For example: • There are no stairs, only access ramps and • The corridors are wide and include hand rails. Each apartment includes: • A sleeping area (either open plan or one bedroom) • A living area • A kitchen (which includes a refrigerator, sink, microwave oven, kettle and toaster) • A bathroom with a shower and toilet with grab rails • Larger than normal power and light switches, • Wider doorways through which wheelchairs can be moved • Hand rails and • Showers with level access (i.e. there is no lip or step, so as to avoid trips and spills). Residence contract Residents of Serviced Apartments enter into a contract with you. A Resident is required to make payments to you, including both an initial upfront Loan and monthly Maintenance Fees. When the Resident leaves the Village, an Exit Fee is payable which is deducted from the Loan repayment to the Resident. The costs and expenses that are covered by the Resident's Maintenance Fee are listed in the Residence Contract. The costs include "the total of all expenses incurred in providing the Serviced Apartment Services". Serviced Apartment Services If an apartment within the Serviced Apartment Complex is to be occupied as a "Serviced Apartment", this will be noted in the Residence Contract. The "Serviced Apartment Services" are defined include: • Three meals per day prepared or provided for within the Village • Linen and towels changed once per week ('heavy laundry) • Cleaning of Residence once per week and • Personal assistance with one or more of the daily living activities set out in paragraphs (a), (b), (d), (e) and (f) of Item 2.1 of Part 2 to Schedule 1 of the Aged Care Principles 2014, which have been confirmed in writing by the Resident's medical practitioner as being a necessary part of the Resident's ongoing care." Meals Residents of Serviced Apartments receive three meals per day within the Village. Morning tea is also supplied. Breakfast provisions are delivered to Residents within their individual apartments. All other meals are provided in the communal dining room, which is separate to the Community Hall. While the community dining room is intended for the use of serviced apartment residents, residents of independent living units may also book to dine in the room for a fee. Emergency Assistance Personal Care Attendants are located onsite at the Village 24 hours per day, 7 days per week, to assist Residents in the event of an emergency. There are presently a number of Personal Care Attendants working at the Village. Only one will be working at the Village at any given time. All Personal Care Attendants are trained in seniors first aid. A number of the staff also have a Certificate 3 in Aged Care (which is a not a mandatory prerequisite qualification for the role). Every Serviced Apartment offers either a button or neck pendant to be worn by the Resident to call for emergency assistance. Residents decide which option they prefer. Communal laundry The communal laundry area includes a combination of commercial and domestic laundry appliances. The commercial appliances are operated by Village staff and are used for heavy laundry (linen and towels). The domestic appliances are made available for Residents to attend to personal clothes washing. Staff can also attend to this for Residents for an additional fee. Resident Assessments New Residents moving into a Serviced Apartment are required to have a medical assessment completed by their local medical practitioner. To assist this process, a standard letter has been prepared for Residents to provide to their doctor, together with a form that is to be completed indicating the residential care services required. Further, Residents may also be required to request their doctor summarise and provide information on their medical care requirements to the Village Manager. A form letter has been prepared to assist Residents with this. You provided the following documents: Serviced Apartments floor plan Floor plans for "studio" and "one bedroom" apartments Photographs: • Birds Eye View of the Village • The interior of a typical serviced apartment, showing the bedroom, kitchen, living and bathroom areas. • A shower in a serviced apartment, including a safety hand rail to assist Residents. • A hallway linking the apartments and with hand rails to assist the safety and mobility of Residents. Residence contract Request for completion of "Assessment of Resident Care Requirements" form. Assessment of Resident Care Requirements form and Medical Release form.

Relevant legislative provisions: A New Tax System (Goods and Services Tax) Act 1999 section 38-25 | A New Tax System (Goods and Services Tax) Act 1999 section 195-1