Private ruling: GST and third party procured medical transport services
Date of advice: 11 June 2018
Published: August 2018

Ruling: Q1: Is the supply of medical transport services you provide to Government Agency (GA) a GST-free supply? | A1: Yes, the supply of medical transport services you provide to GA is a GST-free supply.

Relevant facts and circumstances: ● You are registered for goods and services tax (GST). ● You provide first aid training and private medical transport services. ● You hold a restricted medical transport service licence. ● You contract with Government Agency (GA) to provide non-urgent medical transport services. ● You said you invoice the hospital that engaged you for the service but ultimately it is paid by another entity. ● Currently you charge GST on your invoices to GA.

Relevant legislative provisions: A New Tax System (Goods And Services Tax) Act 1999 ● Subsection 38-10(5) | ● Subsection 38-60(3)

Reasons for decision: Detailed Reasoning - Medical transport Services: Subsection 38-10(5) of the GST Act provides that a supply provided by a medica transport service in the course of the treatment of the recipient of the supply is GST-free. Therefore to be GST-free, supplies by a medical transport service must be: (i) provided by a medical transport service, and (ii) in the course of the treatment of the recipient of the supply. | Detailed Reasoning - Limb (i) Medical transport Service: An ‘medical transport service’ is not defined in the GST Act. However after consideration of the relevant State, Territory and Federal legislation, we consider a medical service to be either: (a) an entity that is primarily established for the purpose of rendering, and which does render, first aid or emergency treatment to, and the transport of, sick and injured persons (b) an entity that is permitted to operate as an medical transport service under a State or Territory law in the State or Territory in which it operates Your licence has been granted in accordance with the relevant State/Territory legislation which means you satisfy requirement (b). | Detailed Reasoning - Limb (ii) Course of treatment: It is considered you are making a supply of treatment to the recipient of a supply if you are making the supply to the person requiring the treatment. In this case you are making the supply of a service to the GA who is not the patient requiring the treatment. Therefore, in these circumstances the supply would usually be a taxable supply. However, an exemption to this is subsection 38-60(3) of the GST Act. | Detailed Reasoning - Australian Government agency: Subsection 38-60(3) provides: (a) a supply is a supply of a service to an * Australian government agency ; and (b) the service is the supplier making one or more other supplies of goods or services to an individual; and (c) at least one of the other supplies is wholly or partly * GST-free under this Subdivision; the first-mentioned supply is GST-free to the extent that the other supplies mentioned in paragraph (b) are GST-free under this Subdivision. | Detailed Reasoning - Limb a: Australian Government Agency is defined in section 195-1 to have the meaning given by section 995-1 of the Income Tax Assessment Act 1997 (ITAA 1997). Australian government agency means: (a) the Commonwealth, a State or a Territory, or (b) an authority of the Commonwealth, a State or a Territory. Based on publicly available information, it is our view that GA is an Australian government agency. | Detailed Reasoning - Limbs b and c: Whilst you are making a supply of a medical transport service to GA, as they contract you for these services, you are also providing these services to the individual patients. Therefore, it is considered that you are making a supply to the patients of services for which you receive no consideration from the patients. This supply is a GST-free supply under subsection 38-10(5) of the GST Act (medical transport services). Given, GA is an Australian government agency, and the underlying supply of medical transport services to the patients are GST-free, your supply to GA is also GST-free.