Private ruling: GST - payment facilitation services
Date of advice: 3 June 2026
Published: 17 August 2026

Ruling: Q1: Are 'payment facilitation services' (Services) supplied by entity A to merchants based in Australia taxable supplies under section 9-5 of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act)? | A1: Yes, Services supplied by entity A to merchants based in Australia are taxable supplies. Supplies of Services by entity A are taxable supplies under section 9-5 of the GST Act because they are made for consideration (being the Transaction Fee), in the course or furtherance of an enterprise carried on by entity A, is connected with Australia, and entity A is registered for GST. Additionally, no GST-free or input taxed provisions of the GST Act apply to Services supplied by entity A to merchants based in Australia. | Q2: Are Services supplied by entity A to merchants who are non-residents of Australia GST-free supplies under any provision in Division 38 of the GST Act? | A2: Supplies of Services to merchants who are non-residents of Australia are GST-free under item 2 in the table in subsection 38-190(1) of the GST Act (Item 2) where the non-resident merchants are not in Australia in relation to those supplies. Entity A's supplies of Services to non-resident merchants are GST-free under Item 2 where the non-resident merchants are not in Australia because they are services (not goods or real property), supplied to non-residents who are not in Australia in relation to the supply at the time the supply is made, and the Services are not connected with goods or real property in Australia. The exclusions at subsections 38-190(2) and (2A) of the GST Act are not applicable to the Services supplied by entity A. Further, although subsection 38-190(3) of the GST Act can deny GST-free treatment where a supply to a non-resident is provided to another entity in Australia (and other requirements are also satisfied), it does not apply here because Entity A's Services are not 'provided' to another entity in Australia. Note: Where a non-resident merchant is in Australia in relation to the supply of Services made by entity A this supply will not be GST-free.

Relevant facts and circumstances: Entity A supplies payment facilitation services (Services) to merchants based in Australia and overseas. The Services are to businesses (merchants) designed to help the merchants accept and process payments from their customers easily and securely, whether the merchant is located in Australia or overseas. At its core, provision of the Services involves the operation of a payment gateway that connects the merchant's system to multiple payment methods so merchants can accept a wide range of payment methods from their clients. Entity A's supplies of its Services involves: • facilitating payments from both Australian and foreign payers to Australian and foreign merchants, and • handling settlement of payments, including the application of transaction fees and commissions, where applicable. The Services supplied to merchants are delivered through Entity A's online payment platform which Entity A operates and maintains. This platform serves as the comprehensive technological infrastructure that enables secure, multi-method payment acceptance and processing. The process to facilitate the transfer of funds between customers and merchants through multiple payment rails broadly encompasses: • creation of a payment session/request when a customer initiates a transaction, • authorisation of the transaction through the relevant payment method network, • receipt of cleared funds into Entity A's collection accounts, • reconciliation and transaction monitoring, and • settlement to merchants after deduction of an agreed fee. This agreed fee is calculated as a percentage of the transaction amount (and may include a fixed fee component depending on the merchant's pricing schedule). This fee is either deducted from the settlement amount prior to payment to the merchant or invoiced separately. Entity A does not offer any financial products to merchants or other customers such as loans, savings accounts or deposit accounts. For completeness Entity A has confirmed that the Services do not involve supplies of interests in " a debt, credit arrangement or right to credit, including a letter of credit". Entity A does not supply goods or digital currencies. Services supplied to non-resident merchants who are not in Australia, are not 'provided' to another entity in Australia. Entity A only supplies the Services to merchants. That is, business clients that have contracted with Entity A for the Services. Entity A supplies the same Service, regardless of who the merchant is or the payment method chosen by the merchant/customer. Entity A does not enter into a Contract with a merchant's customers. Entity A does not enter into any 'triparty' agreements (for example, agreements involving merchants, settlement partners and Entity A).

Relevant legislative provisions: A New Tax System (Goods and Services Tax) Act 1999 section 9-5 | A New Tax System (Goods and Services Tax) Act 1999 subsection 38-190(1) | A New Tax System (Goods and Services Tax) Act 1999 subsection 38-190(3)