Private ruling: GST - education courses
Date of advice: 7 April 2026
Published: 29 June 2026

Ruling: Q1: Is Entity A making a GST-free supply under section 38-85 of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act) when its courses are provided to students through a third party? | A1: Yes, Entity A is making a GST-free supply under section 38-85 of the GST Act when its courses are provided to students through a third party provided the relevant course is an education course as defined in section 195-1 of the GST Act. | Q2: Is Entity A making a creditable acquisition under section 11-5 of the GST Act when it makes payments to Entity B in relation to providing education courses? | A2: Yes, Entity A is making a creditable acquisition under section 11-5 of the GST Act when it makes payments to Entity B in relation to providing education courses provided the supply by the Entity B is a taxable supply.

Relevant facts and circumstances: Entity A is registered for goods and services tax (GST). Entity A is a higher education provider registered with the relevant government agency. Entity A entered into agreement with Entity B for the delivery of a unit and/or course content in relation to education courses it provides. Under the agreement, Entity A authorises Entity B to deliver the units or courses that it has approved to be delivered by Entity B to the students. Students are enrolled with Entity A. All tuition fees are payable to Entity A and Entity A retains a percentage of the total student fees received and pays Entity B an agreed percentage of the total student fees. Entity B is registered for GST.

Relevant legislative provisions: A New Tax System (Goods and Services Tax) Act 1999 section 11-5 | A New Tax System (Goods and Services Tax) Act 1999 section 38-85 | Student Assistance Act 1973 subsection 3(1) | Student Assistance Act 1973 subsection 5D(1)

Reasons for decision: Summary: Generally, section 38-85 provides that a supply of an education course is GST-free. An 'education course' is defined in section 195-1 to include a number of different types of courses. Relevant to your case is a 'tertiary course' which is defined in section 195-1 as: (a) a course of study or instruction that is a tertiary course determined by the Student Assistance Minister under subsection 5D(1) of the Student Assistance Act 1973 for the purposes of that Act (aa) a course of study or instruction accredited at Masters or Doctoral level and supplied by a higher education institution or a non-government higher education institution, or (b) any other course of study or instruction that the Student Assistance Minister has determined is a tertiary course for the purposes of the GST Act. The Student Assistance Minister (the Minister) has issued the Student Assistance (Education Institutions and Courses) Determination 2019 (Determination 2019) under subsections 3(1) and 5D(1) of the Student Assistance Act 1973 (SA Act). It lists the types of courses and types of education institutions that can deliver the courses that are determined as a 'tertiary course'. Section 6 of Determination 2019 provides that for the definition of higher education institution in subsection 3(1) of the SA Act, the following are to be regarded as higher education institutions for the purposes of the SA Act: (a) an institution that is established by a law of the Commonwealth, a State or a Territory as a higher education institution, (b) an institution registered or taken to be registered by TEQSA as a higher education provider. Entity A is a higher education provider registered with TEQSA. Therefore, Entity A is a higher education institution as defined for the purposes of the SA Act. Section 11 of Determination 2019 provides that, for paragraph 5D(1)(a) of the SA Act, a tertiary course is a course that is: (a) specified in Column 1 of the table in Schedule 2 of Determination 2019 and provided by an education institution specified for that course in Column 2 of that table (b) accredited at Masters level and specified in Column 2 of the table in Schedule 3 of Determination 2019 and provided by the education institution specified for that course in Column 1 of that table. Item 5 of the table in Schedule 2 of Determination 2019 lists vocational education and training courses provided by a higher education institution as tertiary courses. Where the courses Entity A supplies fall within Item 5, the supply would be GST-free under section 38-85. Item 6 of the table in Schedule 2 of Determination 2019 lists undergraduate and postgraduate accredited higher education courses provided by a higher education provider as tertiary courses. Where the courses Entity A supplies fall within Item 6, the supply would be GST-free under section 38-85. Item 4 of the table in Schedule 3 of Determination 2019 lists certain courses at masters level provided by Entity A as tertiary courses. Where the courses Entity A supplies is one of those listed in Item 4, the supply would be GST-free under section 38-85. In this regard, where a course that Entity A supplies is GST-free under section 38-85, the supply of that course continues to be GST-free where that course is delivered by Entity B. Under the agreement with Entity B, the students are enrolled with Entity A. As such, Entity A is the entity who makes the supply of an education course to the students. Entity A has simply authorised Entity B to deliver the course for them. Consequently, Entity A is making a GST-free supply under section 38-85 when its courses are provided to students through Entity B, where the relevant course is a tertiary course as defined in section 195-1. Under section 11-20, an entity is entitled to an input tax credit for any creditable acquisition it makes. Section 11-5 provides the criteria for making a creditable acquisition as follows: a) you acquire anything solely or partly for a creditable purpose b) the supply of the thing to you is a taxable supply c) you provide, or are liable to provide, consideration for the supply, and d) you are registered or required to be registered for GST. Generally, an acquisition is made for a creditable purpose if it is made in the course of carrying on an enterprise and is neither of a private nature, nor relates to input taxed supplies. The agreement provides that Entity B will deliver courses to students that are enrolled with Entity A. As such, Entity B supplies its services to Entity A, albeit the services are provided to Entity A'a students. Therefore, Entity A acquires services from Entity B in the course of providing education to the students. Even though Entity B may provide GST-free education courses in their own right, when they are delivering Entity A's courses, Entity A is making GST-free supplies of education courses. This is because the education courses are being supplied by Entity A and Entity B is acting on Entity A's behalf in delivering those courses. Consequently, Entity B is making supplies of their services to Entity A and those services will generally be taxable supplies where Entity B is registered (or required to be registered) for GST. Under the agreement, Entity A is required to pay Entity B for each unit of study that they deliver to students. That is, Entity A is liable to provide consideration for the services provided by Entity B. As Entity A is registered for GST, the acquisitions of services from Entity B are creditable acquisitions under section 11-5 when Entity A provides payment to Entity B for their services of delivering the courses to students