Private ruling: Goods and services tax (GST) and home care services.
Date of advice: 24 April 2019
Published: June 2019
Date scheme commenced: The issue date of the private ruling.

Ruling: Q1: Is the supply of home care services to consumers GST-free where Commonwealth Home Support Programme ("CHSP") funding is received? | A1: Yes

Relevant facts and circumstances: The entity (you) has contracts with the Australian government to provide home aged care services. You are registered for GST. One type of funding received by you is the Commonwealth Home Support Programme ("CHSP") funding from the Department of Health. You do not sub-contract to other providers for the provision of home care services. Services provided range from personal and nursing care, to social support. Specifically, your activities include: ● Providing frail, older people with support in activities of daily living that help them maintain appropriate standards of hygiene and grooming; ● Providing home maintenance services (including cleaning) that assist clients in maintaining their home in a safe and habitable condition, and also creating a home environment that facilitates a client’s reablement goals; ● Assistance to maintain and support care relationships between carers and clients, through providing good quality respite care for frail, older people so that regular carers can take a break; ● Providing frail, older people with assistance with domestic chores to maintain their capacity to manage everyday activities in a safe, secure and healthy home environment; ● Providing meals and also preparing of meals at the older person’s house; ● Assistance with attending medical appointments, social activities and undertaking errands (e.g. groceries); and ● To a lesser degree than the above activities, providing frail, older people with assistance to participate in community life and feel socially included through structured, group-based activities that meet their need for social contact and company, and develop, maintain or support independent living and social interaction. This service/activity is specifically excluded from assessment in this ruling as to whether it is GST-free on the basis that you have determined that it will be subject to GST.

Relevant legislative provisions: A New Tax System (Goods and Services Tax) Act 1999 , Section 38-30(4)

Reasons for decision: Summary: Subsection 38-30(4) of the GST Act provides that a supply of care is GST-free if: ● the supplier receives funding from the Commonwealth, a State or a Territory in connection with the supply, and ● the supply of the care is of a kind determined in writing by the Aged Care Minister to be similar to a supply that is GST-free because of subsection 38-30(2) of the GST Act. For the purposes of subsection 38-30(4) of the GST Act, it is considered that a payment constitutes 'funding from the Commonwealth, a State or a Territory' if the funds are sourced from Commonwealth, State or Territory budgets under a government-funded care program. You receive payment for your services from the Department of Health under the Commonwealth Home Support Programme. These funds are sourced from the Commonwealth Government budget under a government-funded care program and as such, the first requirement of subsection 38-30(4) of the GST Act is satisfied. The Aged Care Minister has made the GST-free Supply (Care) Determination 2017 (Care Determination), which contains two schedules: ● Schedule 1 in relation to a targeted person; and ● Schedule 2 in relation to a carer that substantially enables the carer to give care to a targeted person. Clauses 4 and 5 of the Care Determination provide that the supply of care of a kind mentioned in Schedule 1 to the Care Determination to a 'targeted person', or Schedule 2 to the Care Determination to a carer, is similar to a supply that is GST-free because of subsection 38-30(2) of the GST Act. ‘Care’ means services to enable a targeted person to continue to live at home. ‘Carer’ means a person who provides care to a targeted person. The term 'targeted person' is defined in the Care Determination to mean a frail, older person or a younger person who: ● has a moderate, severe or profound disability (including addiction to a drug) ● lives at home, and · ● would, in the absence of services of the kind mentioned in Schedule 1 to the Care Determination, be at risk of prematurely or inappropriately needing: (i) long term care in a hospital or other institution, or (ii) residential care within the meaning of the Aged Care Act 1997 . | Detailed Reasoning - Service: 1 Home help 2 Personal care 3 Home maintenance 4 Home modification 5 Provision of food 6 Provision and delivery of meals at home or at a day care or similar centre 7 Respite care 8 Transport to and from day care or similar centres and for shopping trips, social outings and for health-related purposes 9 Community paramedical services 10 Community nursing 11 Assessment of the person’s care needs 12 Referral to other community care services 13 Training in the use of aids and appliances and in how to get the most out of the other services mentioned in this Schedule 14 Individual care planning or case management 15 Provision of basic equipment for social support 16 Day care 17 Linen services 18 Counselling 19 Community advocacy for a purpose mentioned in section 81-1 of the Aged Care Act 1997 20 Medication management 21 Provision and monitoring of personal alert systems 22 Provision of therapeutic supplies and services under the program known as the Psychogeriatric Unit Program administered by the Commonwealth 23 Continence management | Detailed Reasoning - Schedule 2 Care provided to carers: Item Service 1 Home help 2 Personal care 3 Home maintenance 4 Home modification 5 Provision of food 6 Provision and delivery of meals at home or at a day care or similar centre 7 Respite care 8 Transport to and from day care or similar centres and for shopping trips, social outings and health-related purposes 9 Training in the provision of services mentioned in Schedule 1 10 Provision of basic equipment for social support 11 Linen services 12 Counselling 13 Carer support 14 Community advocacy for a purpose mentioned in section 81-1 of the Aged Care Act 1997 15 Provision and monitoring of personal alert systems 16 Assessment of the carer’s care needs 17 Referral to other community care services When applying the above to you: ● You receive funding from the Commonwealth in connection with the supply, being the supply of CHSP services. ● The following services are supplied by you to targeted persons (frail, older people): (i) Providing frail, older people with support in activities of daily living that help them maintain appropriate standards of hygiene and grooming, which would fall under Item 2 of Schedule 1 of the Care Determination (personal care). (ii) Providing home maintenance services (including cleaning) that assist clients in maintaining their home in a safe and habitable condition, and creating a home environment that facilitates a client’s reablement goals, which would fall under Items 1, 3 and 4 of Schedule 1 of the Care Determination (home help, home maintenance and home modification). (iii) Assistance to maintain and support care relationships between carers and clients, through providing good quality respite care for frail, older people so that regular carers can take a break, which would fall under Item 7 of Schedule 2 of the Care Determination (respite care). (iv) Assisting frail, older people with assistance with domestic chores to maintain their capacity to manage everyday activities in a safe, secure and healthy home environment, which would fall under Items 1 and 3 of Schedule 1 of the Care Determination (home help and home maintenance). (v) Providing meals but also preparing of meals at the older person’s house, which would fall under Item 5 of Schedule 1 of the Care Determination (provision of food). (vi) Assistance with attending medical appointments, undertaking errands (e.g. groceries) and attending social outings, which would fall under Item 8 of Schedule 1 of the Care Determination (transport to and from day care or similar centres and for shopping trips, social outings and for health-related purposes). Based on the above, the home aged care supplies up to the cap indicated by CHSP (based on a dollar-value or hours) by you are GST-free pursuant to section 38-30(4).