Private ruling: Charity and GST eligibility
Published: July 2013
Ruling period: Year ending 30 June 2013 | Year ending 30 June 2014

Ruling: Q1: Will the Company continue to be entitled to be endorsed as a charity pursuant to section 176 -1 of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act) if the proposed changes occur? | A1: Yes

Relevant facts and circumstances: The Company is a company limited by guarantee. The Company is an entity listed with the Australian Charities and Not-for-profits Commission (ACNC) as a Registered Charity. The Company is endorsed as exempt from income tax as a Registered Charity as described in item 1.1 of the table in section 50-5 of the Income tax Assessment Act 1997 (ITAA 1997). The Company is endorsed as a deductible gift recipient (DGR) - public hospital, as an entity described in item 1.1.1 of section 30-20 of the ITAA 1997. The Company previously received a private binding ruling which confirmed that the benefits it provides to its employees are exempt benefits by virtue of subsection 57A (3) of the Fringe Benefits Assessment Act 1986 (FBTAA 1986). The Company manages and controls a hospital and employees of the staff of the hospital. The Company receives moneys from the following sources: · fees from patients, Medicare and private health insurers; · fees from car parking and subleasing of the premises to service providers; · donations from the public; The Company is the lessee of a hospital and the employer of the staff of the hospital. The hospital is a hospital providing acute surgery facilities and accommodation and continuous general medical care and treatment for patients suffering sickness, disease or injury. All doctors, nursing staff and other staff employed by the hospital are employed exclusively in the kind of work ordinarily performed in relation to the operation of a hospital. The hospital also engages a significant number of specialist medical practitioners as accredited practitioners of the hospital.

Relevant legislative provisions: A New Tax System (Goods and Services Tax) Act 1999 Section 176 -1

Reasons for decision: Summary: Section 176 -1 of A New Tax System (Goods and Services Tax) Act 1999 (GST Act) provides that the Commissioner must endorse an entity as a charity for GST purposes if it meets certain requirements. It states: | Detailed Reasoning - (1): The Commissioner must endorse an entity as a charity if: (a) the entity is entitled to be endorsed as a charity (see subsection (2)); and (b) the entity has applied for that endorsement in accordance with Division 426 in Schedule 1 to the Taxation Administration Act 1953 . | Detailed Reasoning - (2): An entity is entitled to be endorsed as a charity if the entity: (a) is an *ACNC-registered charity; and (b) has an *ABN. The Company is presently an ACNC-registered charity and has an ABN. Eligibility as an ACNC-registered charity is determined by the Australian Charities and Not-for-profits Commission (ACNC) and for the purposes of goods and services tax, is defined in section 195-1 of the GST Act as: registered charity means an entity that is registered under the Australian Charities and Not-for-profits Commission Act 2012 as the type of entity mentioned in column 1 of item 1 of the table in subsection 25-5(5) of that Act. As the status of whether an entity is a Registered Charity or not is determined by the ACNC, provided the Company remains a Registered Charity and continues to have an ABN, it will continue to be entitled to be endorsed as a charity pursuant to section 176 -1 of the GST Act.