Private ruling: GST and language courses
Date of advice: 19 July 2022
Published: November 2022
Ruling period: Year ending 30 June 20XX to Year ending 30 June 20XX
Date scheme commenced: XX July 20XX

Ruling: Q1: Is your supply of language courses that are funded by a State Government, to primary and secondary school students GST-free under section 38-85 of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act)? | A1: Yes, your supply of language courses that are funded by a State Government, to primary and secondary school students are GST-free under section 38-85 of the GST Act.

Relevant facts and circumstances: You are a language education school. You are registered with the Australian Charities and Not-for-profits Commission. You are not currently registered for goods and services tax (GST). Your principal aim is to advance the education in language and culture for school aged children. You receive funding from a State Government through its Department of Education for the provision of language courses to primary and secondary school students. You do not provide language courses to students who are not primary or secondary school students. You provide language courses after school hours and on the weekends. These courses are currently being conducted from a High School located in your State. You have entered into a funding agreement with your State Government in relation to the delivery of a language program to students. According to the funding agreement you must ensure the language program is appropriate to the age of the student and aligned with: The funding agreement provides that you are only eligible to receive funding if you are a charity registered with the Australian Charities and Not-for-Profits Commission and maintain the status during the funding period. To obtain the funding you are required to meet the 'Services Delivery Requirements' as set out in the funding agreement which provides amongst other things, that the program must be delivered from premises that are not used as a residence and delivered in a face-to-face manner, the program consists of weekly language sessions for at least 36 weeks of the year, there must be a minimum of 6 students enrolled in the program and the program is offered to students irrespective of cultural background. The school fee you charge only include student tuition and textbook. You are listed in your State Government website as a Community language school (CLS).

Relevant legislative provisions: A New Tax System (Goods and Services Tax) Act 1999 section 38-85

Reasons for decision: Summary: The supply of an education course is GST-free under section 38-85 of the GST Act. The term 'education course' is exhaustively defined in section 195-1 to include amongst other things, a primary course and a secondary course. In this case, you supply the language courses to primary and secondary school children on weekends. On 24 March 2017, the Minister for Social Services issued A New Tax System (Goods and Services Tax) (Language Other Than English - LOTE - courses offered by ethnic schools) Determination 2017 (LOTE Determination). The LOTE Determination, states that a LOTE course that is provided to primary school students by an ethnic school is a primary course for the purposes of the GST Act and also that a LOTE course that is provided to secondary school students by an ethnic school is a secondary course for the purposes of the GST Act. Under the LOTE Determination, a LOTE course that is provided to primary (or secondary) school students by an ethnic school is a primary (or secondary) course for GST purposes where the LOTE course is provided by, or on behalf of, a school that: Your State's Department of Education through your State Government's Community Language Schools (CSL) program provides funding to support eligible, not-for-profit community language schools (CLS). The CLS program is intended to: You have provided a copy of the funding agreement between yourselves and your State Government acting through its Department of Education, which show you receive a community language school grant. To obtain the funding under your State's CLS program you were required to satisfy the eligibility criteria as set out in the funding agreement. The receipt of the funding means that you have satisfied the relevant eligibility criteria established by your State's Department of Education and are recognised by the State Government to provide community language courses therefore meeting the fourth requirement of the LOTE Determination. Based on the facts you have provided you also satisfy the other three requirements of the LOTE Determination. Therefore, providing you continue to receive funding from your State's Department of Education for the language courses you provide to primary and secondary school children, the courses will be GST-free primary courses and secondary courses under section 38-85 of the GST Act.

The Australian Curriculum; or | Your State Government language program if the language you teach is not within the Australian Curriculum; and/or | Senior Syllabus for Years 11 and 12. | is a body corporate that operates on a not-for-profit basis | has as its principal aim the teaching of languages other than English | has close links with a community whose first/heritage language is not English, and | is licensed, recognised, accredited, or in any way approved to provide such courses by a State or Territory authority responsible for that approval, in the manner applicable within the relevant State or Territory. | Expand the number of languages available in your State for school students to study | Increase the number of students gaining Year 12 certification in a language.