Private ruling: GST registration and creditable acquisitions
Date of advice: 3 October 2025
Published: 24 November 2025
Ruling period: DD September 20YY to DD September 20YY
Date scheme commenced: DD November 20YY

Ruling: Q1: Is the Trust carrying on an enterprise under section 9-20 of the A New Tax System (Goods and Services) Tax Act 1999 (GST Act)? | A1: No | Q2: Is the Trust required to be registered for GST under section 23-5 of the GST Act? | A2: No | Q3: Is theTrust eligible to be registered for GST under section 23-10 of the GST Act? | A3: No | Q4: If the Trust is registered (or required to be registered) for GST, are the Trustee Fees payable by the Trust to the Trustee for an acquisition, such that the Trust is making a: (a) creditable acquisition under section 11-5 of the GST Act; or (b) a reduced credit acquisition under section 70-5 of the GST Act? | A4: Response not necessary | Q5: If the Trust is registered (or required to be registered) for GST, is the Investment Management Fee payable by the Trust consideration for an acquisition, such that the Trust is making a: (a) creditable acquisition under section 11-5 of the GST Act; or (b) a reduced credit acquisition under section 70-5 of the GST Act? | A5: Response not necessary | Q6: If the Trust is registered (or required to be registered) for GST, is the Trust making a creditable acquisition under section 11-5 of the GST Act or a reduced credit acquisition under section 70-5 in respect of the following: (a) Legal Fees payable (b) Other Service Provider Fees (c) Executive Office Fees (d) Payment Charges payable (e) Program License Fee (f) Venue and Catering Payments (g) Travel and Accommodation Payments (h) Printing and Stationary Payments (i) Accounting Fees (j) Audit Fees (k) Card/Voucher Personal Expenditure (l) Third Party Personal Expenditure Payments (m) Reimbursement Payments? | A6: Response not necessary

Relevant facts and circumstances: The Trust was established to hold, manage and distribute funds to it beneficiaries in accordance with its Trust Deed. The Trust is not registered for GST and its GST turnover is less than $75,000. The Trust receives payments from a third-party entity which forms part of the trust fund. Payments received by the Trust (such as the payments from the third-party entity) are invested by the Trust and the investment-related income is generally used to pay trust expenses. The Trust only conducts investment activities from which it derives interest, dividends and other investment-related income (in accordance with its Investment Policy). It does not make any other supplies of goods and services. The investment portfolio is reviewed quarterly or bi-annually at which time changes may occur. A full investment review is undertaken once per year. The Investment Policy is formally reviewed once every three years and unless there are significant changes to market conditions and/or internal assumptions they are rarely changed. The Trust incurs the following expenses in operating its activities (i.e. holding trust meetings, day-to-day functions and making trust distributions): Trustee Fees, Investment Management Fees, Legal Fees, Other Service Provider Fees, Executive Office Fees, Payment Charges payable, Program License Fee, Venue and Catering Payments, Travel and Accommodation Payments, Printing and Stationary Payments, Accounting Fees, Audit Fees, Card/Voucher Personal Expenditure, Third Party Personal Expenditure Payments and Reimbursement Payments.

Relevant legislative provisions: A New Tax System (Goods and Services) Tax Act 1999 section 9-20 | A New Tax System (Goods and Services) Tax Act 1999 section 23-5 | A New Tax System (Goods and Services) Tax Act 1999 section 23-10

Reasons for decision: Summary: No. The Trust is not carrying on an enterprise. | Detailed Reasoning - Detailed reasoning: Section 9-20 of the GST Act states: (1) An enterprise is an activity, or series of activities, done: (a) in the form of a *business; or (b) in the form of an adventure or concern in the nature of trade; or (c) on a regular or continuous basis, in the form of a lease, licence or other grant of an interest in property; or (d) by the trustee of a fund that is covered by, or by an authority or institution that is covered by, Subdivision 30-B of the Income Tax Assessment Act 1997 and to which deductible gifts can be made; or (da) by a trustee of a *complying superannuation fund or, if there is no trustee of the fund, by a person who manages the fund; or (e) by a charity; or (f) (Repealed by No 169 of 2012) (g) by the Commonwealth, a State or a Territory, or by a body corporate, or cooperation sole, established for a public purpose by or under a law of the Commonwealth, a State or a Territory; or (h) by a trustee of a fund covered by item 2 of the table in section 30-15 of the ITAA 1997 or of a fund that would be covered by that item if it had an ABN. (* denotes a term defined in section 195-1 of the GST Act). Miscellaneous Taxation Ruling MT 2006/1 The New Tax System: the meaning of entity carrying on an enterprise for the purposes of entitlement to an Australian Business Number (MT 2006/1) contains the Commissioner's view on what constitutes an enterprise for the purposes of eligibility for an Australian Business Number. Goods and Services Tax Determination GSTD 2006/6 Goods and services tax: does MT 2006/1 have equal application to the meaning of 'entity' and 'enterprise' for the purposes of the A New Tax System (Goods and Services Tax) Act 1999? (GSTD 2006/6) extends the application of MT 2006/1 to the GST Act. The principles in MT 2006/1 apply equally to the term 'enterprise' and can be relied upon for GST purposes. In this case section 9-20(1)(c) to (h) of the GST Act does not apply. Therefore, what remains to be considered is whether the activities of the Trust is in the form of a business or in the form of an adventure or concern in the nature of trade. Although we accept that the activities of the Trust are carried out in a professional and systematic manner, we do not agree that the Trust is carrying on an enterprise 'in the form of a business'. Our reasons are set out below. In the form of a business Paragraphs 177 to 179 of MT 2006/1 discuss the main indicators of carrying on a business, and state: Indicators of a business 177. To determine whether an activity, or series of activities, amounts to a business, the activity needs to be considered against the indicators of a business established by case law. 178. TR 97/11 discusses the main indicators of carrying on a business. Based on that discussion some indicators are: • a significant commercial activity; • a purpose and intention of the taxpayer to engage in commercial activity; • an intention to make a profit from the activity; • the activity is or will be profitable; • the recurrent and regular nature of the activity; • the activity is carried on in a similar manner to that of other businesses in the same or similar trade; • activity is systematic, organised and carried on in a businesslike manner and records are kept; • the activities are of a reasonable size and scale; • a business plan exists; • commercial sales of product; and • the entity has relevant knowledge or skill. 179. There is no single test to determine whether a business is being carried on. Paragraph 12 of TR 97/11 states that 'whilst each case might turn on its own particular facts, the determination of the question is generally the result of a process of weighing all the relevant indicators.' TR 97/11 can be referred to for a fuller discussion on whether a particular activity constitutes the carrying on of a business. The question of 'whether a business is being carried on' is a question of fact and the conclusion generally depends on weighing up all the relevant factors set out above. Paragraph 11 of GSTD 2006/6 further explains the meaning of 'enterprise' and states: 11. An enterprise includes an activity, or series of activities, done in the form of a business. The phrase 'in the form of a business' is broad and has as its foundation the longstanding concept of a business. The wider phrase has not been considered by Australian courts. The definition clearly includes a business and the use of the phrase 'in the form of' indicates a wider meaning than the work 'business' on its own. This occurs in the case of non-profit entities. In such instances we consider that not all of the main features of a business such as a capacity to earn and distribute profits need to be present before an activity has the form of a business. Paragraphs 206 to 208 of MT 2006/1 provides an example of a situation that would not constitute and enterprise and states: Example 24 - investment activities that are not an enterprise 206. A trust is set up in respect of 12,000 blue chip shares and term deposits of $100,000 from which dividends and interest are received. The total portfolio is worth $350,000 to be held for the benefit of the trustee's children and grandchildren. The trustee incurs expenses including bank fees, accountancy fees and brokerage associated with the management of the portfolio. The net income of the trust is distributed to the beneficiaries of the trust. The shares are held for investment purposes. 207. Once or twice a year small parcels of underperforming shares in one or two of the companies in the portfolio are sold and the proceeds reinvested in other shares or deposits. The trustee has no other activities. There is no business plan, the activities are not systematic and are less organised than would be typical for a business. 208. The trustee is not entitled to an ABN. The activities undertaken are insufficient to amount to an enterprise. Consistent with the above example the Trust is established to conduct investment activities from which it derives interest, dividends and other investment-related income. It does not make any other supplies of goods and services. The investment portfolio is reviewed quarterly or bi-annually at which time changes may occur. Further, according to the Trust Objects, the Trust distributes trust funds, accepts payments into the trust, and holds funds for the benefit of the beneficiaries in accordance with the Trust Deed. The Trustee pays costs associated with the investment activity and the administration of the Trust. Although we accept the Trust can make sales and purchases of significant value when investments are changed, and it carries out its role in a professional and systematic manner, the activities of Trust are not carried out in the form of a business and are insufficient to amount to an enterprise. On this basis we do not consider that the Trust carries on an enterprise under paragraph 9-20(a) of the GST Act. In the form of an adventure or concern in the nature of trade Paragraphs 234 to 237 of MT 2006/1 explain the concept of the term 'in the form of an adventure or concern in the nature of trade'. The term 'business' encompasses trade engaged in, on a regular or continuous basis. However, an adventure or concern in the nature of trade may be an isolated or one-off transaction that does not amount to a business but which has the characteristics of a business deal. Paragraphs 258 to 261 of MT 2006/1 further describes the difference between trade and investment assets. Assets that are purchased with the intention of holding them for a reasonable period of time, to be held as income producing assets are more likely to not be purchased for trading purposes and the mere disposal of investment assets does not amount to trade. Ordinarily the disposal of investment assets is not considered to be an adventure or concern in the nature of trade. In this case, the activities of the Trust do not amount to 'an adventure or concern in the nature of trade'. On this basis we do not consider that the Trust carries on an enterprise under paragraph 9-20(b) of the GST Act. Conclusion Whilst it is accepted that the Trust operates in a professional manner, its operations are not business-like nor an adventure or concern in the nature of trade. Therefore, the Trust is not carrying on an enterprise under section 9-20 of the GST Act. | Detailed Reasoning - Question 2: Is the Trust required to be registered for GST under section 23-5 of the GST Act? | Summary: No. The Trust is not required to be registered for GST under section 23-5 of the GST Act as it is not carrying on an enterprise. | Detailed Reasoning - Detailed reasoning: Section 23-5 of the GST Act, provides that you are required to be registered if: (a) you are *carrying on an *enterprise; and (b) your *GST turnover meets the *registration turnover threshold. As outlined in our response to Question 1, the Trust is not carrying on an enterprise under section 9-20 of the GST Act. Therefore, the Trust is not required to be registered under section 23-5 of the GST Act as paragraph 23-5(a) is not satisfied. | Detailed Reasoning - Question 3: Is theTrust eligible to be registered for GST under section 23-10 of the GST Act? | Summary: No. The Trust is not eligible to register for GST under section 23-10 of the GST Act as it is not carrying on an enterprise. | Detailed Reasoning - Detailed reasoning: Section 23-10 of the GST Act states: (1) You may be *registered under this Act if you are carrying on an *enterprise (whether or not your *GST turnover is at, above or below the *registration turnover threshold). (2) You may be *registered under this Act if you intend to carry on an *enterprise from a particular date. As outlined in our response to Question 1, the Trust is not carrying on an enterprise for GST purposes. Furthermore, the Trust has not provided information to indicate that it intends to carry on an enterprise from a particular date or that it intends to carry out activity different to that described in the facts and circumstances. Consequently, the Trust cannot elect to register for GST pursuant to subsection 23-10 of the GST Act. | Detailed Reasoning - Question 4: If the Trust is registered (or required to be registered) for GST, are the Trustee Fees payable by the Trust to xxx consideration for an acquisition, such that the Trust is making a: (a) creditable acquisition under section 11-5 of the GST Act; or (b) a reduced credit acquisition under section 70-5 of the GST Act? | Detailed Reasoning - Detailed reasoning: Response not necessary | Detailed Reasoning - Question 5: If the Trust is registered (or required to be registered) for GST, is the Investment Management Fee payable by the Trust to xxx consideration for an acquisition, such that the Trust is making a: (a) creditable acquisition under section 11-5 of the GST Act; or (b) a reduced credit acquisition under section 70-5 of the GST Act? | Detailed Reasoning - Detailed reasoning: Response not necessary | Detailed Reasoning - Question 6: If the Trust is registered (or required to be registered) for GST, is the Trust making a creditable acquisition under section 11-5 of the GST Act or a reduced credit acquisition under section 70-5 in respect of the following: (a) Legal Fees payable (b) Other Service Provider Fees (c) Executive Office Fees (d) Payment Charges Payable (e) Program License Fee (f) Venue and Catering Payments (g) Travel and Accommodation Payments (h) Printing and Stationary Payments (i) Accounting Fees (j) Audit Fees (k) Card/Voucher Personal Expenditure (l) Third Party Personal Expenditure Payments (m) Reimbursement Payments? | Detailed Reasoning - Detailed reasoning: Response not necessary