Private ruling: Medical aids and appliances
Published: December 2012
Ruling period: Not relevant in this case.
Date scheme commenced: Not relevant in this case

Ruling: Q1: Is the medical aid used for transporting disabled and mobility impaired people to the water's edge a GST-free medical aid or appliance for the purposes for which you use it? If not, would the Australian Taxation Office (ATO) consider including it in schedule 3 to the GST Act for the purpose for which you use it? What "GST concessions" are you entitled to under the charity status registration granted to you by the ATO? Do these "concessions", mean a special arrangement for you? | A1: No. The medial aid used for transporting disabled and mobility impaired people to the water's edge is not a GST-free medical aid or appliance for the purposes for which you use it. See below. See below See below

Relevant facts and circumstances: You are a public benevolent institution and an ATO registered charity. You are not registered for the goods and services tax (GST). You are entitled to several taxation concessions, one being that related to GST. You look after disabled and/or mobility impaired people at the beach. One of the difficulties you are faced with in providing this service is in transporting wheelchair bound people and those with mobility impairment to the water's edge. Sometimes you might be required to take up to X severely handicapped people for a specified experience in one session. At present your volunteers carry them or push them across soft sand to get them to the water's edge. The physical exertion of doing this burns out the volunteers. You intend to purchase a product which could be rolled out from firm ground to the water's edge so that wheelchairs could traverse to the water. The brochure for the product states it is "…. for vehicles including wheelchairs, strollers, bicycles, ATV's, motorcycles and emergency & law enforcement engines". This product can be used for other purposes, but you will be using it only for the purposes stated above. You will be using the product as a medical aid for therapeutic purposes.

Relevant legislative provisions: A New Tax System (Goods and Services Tax) Act 1999 - Section 38-45

Reasons for decision: Detailed Reasoning - GST-free medical aids and appliances: Supply of medical aids and appliances is GST-free where the medical aids and appliances satisfy all of the requirements specified in subsection 38-45(1) of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act). Under subsection 38-45(1) of the GST Act, for the supply of medical aids and appliances to be GST-free, they must: · be covered by Schedule 3 of the GST Act (Schedule 3), or specified in the A New Tax System (Goods and Services Tax) Regulations 1999 (GST Regulations), · be specifically designed for people with an illness or disability and · not be widely used by people without an illness or disability. "Transfer sheets, mats or belts" are listed as item 92 in Schedule 3 to the GST Act under the broad category, "Mobility of people with disabilities - physical: transfer aids". The product you intend to purchase, in general terms, is not a medical aid or appliance as such, but a pathway for vehicles and pedestrian traffic. As the brochure states it is "for wheelchairs, strollers, bicycles, ATV's, motorcycles and emergency & law enforcement engines". Item 92 in Schedule 3 represent products which are to be used in medical situations. These are transfer sheets, mats or belts to be used in moving patients in hospitals or aged care type of facilities. The product you refer to are for transporting people with mobility impairment to water's edge for therapeutic or recreation activities. Therefore, the product you wish to purchase is not covered under item 92 of Schedule 3. Nor is the product captured under any other item in Schedule 3 or the GST Regulations. Further, the product is not "specifically designed for people with an illness or disability". It is designed for a wide range of applications, one of which is the purpose for which you intend to use it for. Therefore, the product does not satisfy the second requirement stated above. Further, it also does not satisfy the third requirement where it states the item should be one which is not widely used by people without an illness or disability. According to the brochure submitted, it is used for a variety of applications other than moving mobility impaired people. Consequently, the product,is not a GST-free medical aid or appliance. The use for which you put a specific product does not change its character for the purpose of the provisions in section 38-45 of the GST Act. | Detailed Reasoning - Items included in Schedule 3: Items listed in Schedule 3 to the GST Act and in the GST Regulations are those included under acts of Parliament. The ATO has no power to include items to either of these two schedules. The role of the ATO is only to administer the laws as enacted by Parliament. If you wish to have this product included in Schedule 3 or in the GST Regulations, you may need to take it up with your member of Parliament as a matter for the Parliament to consider. | Detailed Reasoning - "GST concessions": Section 176 -1 of the GST Act states that the Commissioner must endorse an entity as a charitable institution if the entity is entitled to be so endorsed, has an ABN and, has applied for such endorsement in accordance with the requirements in the Tax Administration Act 1953. You informed us that the Commissioner has endorsed you on this basis. Your endorsement entitles you to claim special GST concessions. As an endorsed charity, there are a number of concessions available to you. The first of these is that, along with other non-profit bodies, you do not have to register for the GST unless your GST turnover is $150,000 or more. However, if you do register, some of the concessions available to you, in summary, are as follows: · You will be entitled to use cash basis of accounting irrespective of your turnover. In general, an entity whose turnover is $ 2 million or over must use non-cash basis of accounting. · As an endorsed charity you are entitled to split your operations into separate independent branches for GST purposes. · Anything you supply is GST-free if the consideration you receive for it is less than 50% of the market value including GST. In the case of accommodation, the consideration need only be less than 75% of market value. · If you operate a "over 55s" retirement village, the supplies of accommodation, accommodation related services, or meals, are GST-free. · Subject to relevant State or Territory law, any raffle or bingo conducted by you will be GST-free. · Under certain conditions, any supply of donated second-hand goods you make will be GST-free. Please note that to avail yourself for the above concession, you must be registered. Also, the above descriptions of the concessions are in their summarised form and should you wish to claim any of these concessions, you should seek advice from the ATO by providing details of the circumstance.

Please check this edited version to be sure that there are no details remaining that you think may allow you to be identified. If you have any concerns about this ruling you wish to discuss, you will find our contact details in the fact sheet.