Private ruling: GST and going concern
Date of advice: 20 November 2020
Published: January 2021

Ruling: Q1: Is the supply of a 'Farmout Interest' in the mining permit and associated assets by you to the Recipient pursuant to the Farmout Agreement, a GST-free going concern pursuant to section 38-325 of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act)? | A1: Yes, the supply of the 'Farmout Interest' in the mining permit and associated assets by you to the Recipient pursuant to the Farmout Agreement is a GST-free going concern pursuant to section 38-325 of the GST Act.

Relevant facts and circumstances: You and the Recipient entered into an Farmout Agreement under which you as the 'Farmor' wishes to transfer and convey, and the Recipient as the 'Farmee' wishes to acquire, the Farmout Interest on the terms and conditions set forth in the Farmout Agreement. In your circumstances, the Commissioner considers that your supply of the 'Farmout Interest' in the mining permit and associated assets to the Recipient pursuant to the Farmout Agreement is a GST-free going concern pursuant to section 38-325 of the GST Act.

Relevant legislative provisions: A New Tax System (Goods and Services Tax) Act 1999 - section 38-325