Private ruling: GST-free medical aids and appliances
Published: June 2012

Ruling: Q1: Will your supply of a product be a GST-free supply? | A1: No.

Relevant facts and circumstances: This ruling is based on the facts stated in the description of the scheme that is set out below. If your circumstances are materially different from these facts, this ruling has no effect and you cannot rely on it. The fact sheet has more information about relying on your private ruling. You are registered for GST. You carry on an enterprise. You produce a product that turns a particular appliance off if the user is not present. You have stated that the product is specifically designed for use by specified sufferers. You have provided a copy of a brochure for the product. You have provided a copy of the product manual You believe that the product meets the criteria for a GST-free medical aid or appliance, specifically item 31 (at least).

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

Reasons for decision: Summary: As you are registered for GST, you make a taxable supply if: · you make the supply for consideration · the supply is made in the course or furtherance your enterprise, and · the supply is connected with Australia. However, the supply is not taxable to the extent that it is GST-free or input taxed. The supply of a medical aid or appliance is GST-free under subsection 38-45(1) of the GST Act if it is: · listed in Schedule 3 to the GST Act or in Schedule 3 to the GST Regulations · specifically designed for people with an illness or disability, and · not widely used by people without an illness or a disability. Item 31 in Schedule 3 of the GST Act (item 31) lists 'environmental control units designed for the disability of a particular person'. The GST Pharmaceutical Health Forum - issues register - attachment A - schedule 3 - medical aid or appliance describes 'environmental control units designed for the disability of a particular person' as: A device or unit specifically designed for the disability of a particular person whereby that person is able to control the immediate environment such as operating devices and opening and closing doors, turning off light switches etc. 'Environmental control units' are further described below. | Detailed Reasoning - Description: An 'environmental control unit' is an assistive device which enables a person with a severe, long term disability, for example, high quadriplegia, to control and operate electrical appliances in their own home, or hospital. An 'environmental control unit' allows the user to 'control their environment'. | Detailed Reasoning - Purpose: A person with a disability may be unable to control their surroundings, and have difficulty turning on lights, answering the telephone, or controlling the television. An 'environmental control unit' enables a disabled person to control a range of devices, including lights, the phone, television, door openers and intercoms. An 'environmental control unit': · provides increased independence for people with disabilities · helps a disabled person regain independence over their environment · improves the quality of life for a disabled person through the use of assistive technology How is an 'environmental control unit' controlled? An 'environmental control unit' is controlled by an individual user by a variety of control devices. The type of device used depends on the individual users function. These devices can range from: · voice activated only · switch activated, for example, Sip & Puff, where an individual with extremely limited movements sips or puffs air into or out of a tube · voice and/or switch activated · motion detected, for example, an eye blink What can an 'environmental control unit' do? An 'environmental control unit' is made up of one small unit, and is designed to enable the user to activate a variety of appliances. The range of items controlled can include the following: · lights, for example, on/off · volume adjustment, for example, television · bed control operating, for example, adjusting a bed up/down · appliances, for example, television, fans, blenders · phones, for example, redial, hold, call waiting · infra red remote control devices, for example, television · computers · accessories, for example, door openers, page turners, nurse calls, opening drapes An 'environmental control unit' is a highly specialised piece of equipment that can control just about any electronic device in the home. Therefore, the ATO considers that an 'environmental control unit' is an assistive device which enables a disabled person to control a range of electrical devices such as lights, telephones, televisions, door openers and intercoms. You have advised that the product turns the appliance off if the user is not present. We consider the product to be a safety device performing a 'safety switch' function similar to a residual current device (RCD) rather than an assistive device that enables a disabled person to control a range of electrical devices. Therefore, we do not consider the product to be an 'environmental control unit'. Furthermore, your brochure for the product indicates that the product is not a device designed for the disability of a particular person. Rather, it is a device that is designed for use by a broader class of people including specified sufferers, the elderly and the forgetful. Therefore, we do not consider the product to be a device designed for the disability of a particular person. Accordingly, we do not consider that the product is covered by item 31. Furthermore it is not covered by any items listed in Schedule 3 to the GST Act or specified in the GST Regulations. Therefore, your supplies of the product are not GST-free.

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.