Private ruling: GST and supply of courses
Date of advice: 22 June 2015
Published: June 2015

Ruling: Q1: Are the training courses that you supply GST-free education courses under the A New Tax System (Goods and Services Tax) Act 1999 (GST Act)? | A1: Based on the information received, you supply training courses for entry into a trade specialised occupation as an operator and refresher courses to licence holders. The training courses that you supply are GST-free supplies of education courses under section 38-85 of the GST Act as the courses meet the requirements of a professional or trade course as defined in section 195-1 of the GST Act. The supply of refresher courses to licence holders is not a GST-free supply of education courses under section 38-85 of the GST Act as the refresher courses do not meet the requirements of a professional or trade course as defined in section 195-1 of the GST Act. | Q2: Are the heavy vehicle training courses that you supply GST-free education courses under the GST Act? | A2: When the Certificate of Attainment received from your course is a pre-requisite to obtain a heavy vehicle driving licence from the Department of Transport (DOT), the supply of your heavy vehicle training course is a GST-free education course under section 38-85 as the course meets the requirements of a professional or trade course as defined in section 195-1 of the GST Act. When the Certificate of Attainment received from your course is not a pre-requisite to obtain a heavy vehicle licence from DOT, the supply of your heavy vehicle training course is not a GST-free education course under section 38-85 of the GST Act as the course does not meet the requirements of a professional or trade course as defined in section 195-1 of the GST Act. The supply will be subject to GST as you are registered for GST. The supply of refresher courses to heavy vehicle licence holders is not a GST-free supply of education courses under section 38-85 of the GST Act as the refresher courses do not meet the requirements of a professional or trade course as defined in section 195-1 of the GST Act. | Q3: Are the heavy vehicle driving assessments that you supply GST-free under the GST Act? | A3: Yes, the heavy vehicle driving assessments that you supply is GST-free under section 38-110 of the GST Act? Relevant fact You are registered for the goods and services tax (GST) and are registered as a qualified and approved provider of training courses in Australia. You supply the following courses to students: • TLILIC2001A - licence to operate a forklift truck • TLIC2002A - drive light rigid vehicle ( LR) • TLIC3004A - drive a heavy rigid vehicle (HR) • TLIC3005A - drive a heavy combination vehicle (HC) • TLIC4006A - drive a multi-combination vehicle (MC) You are authorised by DOT in your State to provide heavy vehicle driving assessment that is endorsed by DOT to applicants of heavy vehicle licence. Forklift course As part of Occupational Health and Safety (OHS) and Workplace regulations, all workplaces require employees to have a licence to operate a forklift, thus avoiding heavy fines imposed by courts and applicable State regulations (Worksafe).The forklift licence cannot be issued without receiving the Worksafe Card issued by Worksafe. Under Worksafe's requirements, the student will need to be trained by a Registered Training Organisation (RTO) and assessed by a Worksafe Registered Assessor to obtain the qualification. Worksafe lists its registered assessors on its website and your assessor who is your trainer, is listed with his licence number and credentials. The training course as prescribed by Worksafe for forklift licences is mandatory. The licence obtained through Worksafe is mandatory to operate the forklift. Upon completion of the forklift course that you provide, students are required to undergo an assessment. The students are then issued with a Statement of Attainment. For each forklift assessment, the assessment must be endorsed by Worksafe. Worksafe requires a copy of the Certificate of Attainment to issue a Worksafe Card displaying the forklift licence. You provide Worksafe with proof of the training and assessment (Certificate of Attainment) along with a completed application form. Once Worksafe process the application, the card is sent directly to the student/applicant. There have been instances where refresher courses have been conducted for students who have already been issued with a licence. In principal the course is still the same in each scenario and they can be issued, but not always necessarily with a Certificate of Attainment. The students can still fail the course in that instance but, it does not mean that they will lose their respective licence. Heavy Vehicle driving courses In your State the heavy vehicle driving courses are prescribed by the Training Accreditation Council (TAC) and a Certificate of Attainment is issued after completing a course assessment. The training course and assessment conducted by an RTO does not necessarily lead to a driving licence qualification. To obtain a heavy vehicle driving licence, a driving assessment must be done and the heavy vehicle driving assessment must be endorsed by DOT. For RTOs that have been approved by DOT to be DOT assessors, upon successful completion of the course this Certificate of Attainment is required as proof by DOT of verification of course completion to enable the applicant to be provided with a licence, along with the assessment results. This Statement of Attainment cannot be used solely as evidence provided to DOT and subsequently the student is supplied with a heavy vehicle licence. It is not mandatory to complete the heavy vehicle training course and assessment in order to obtain a heavy vehicle driving licence. It is quite possible for a licence applicant to undergo the heavy driving assessment and pass without any prior training. Applicants have been known to be working on off-road worksites and have obtained the experience without undergoing any formal training. The licence obtained through DOT however is mandatory to operate the heavy vehicle on public roads. Heavy vehicle driving assessment A heavy vehicle driver is required to hold a heavy vehicle driving licence in accordance to the type of heavy vehicle they are driving. Should a heavy vehicle driver be caught for a traffic offence, there are penalties and possible other driver licence disqualifications under applicable State law if the heavy vehicle driver cannot provide the applicable licence. To obtain a heavy vehicle driving licence, an individual can go to DOT and does the driving assessment in his/her own truck. If the individual passes the driving assessment DOT issues a heavy vehicle driving licence to the individual. The individual is not required to have a formal heavy vehicle driving training and an assessment from an RTO when they have the driving assessment with DOT. The assessment for the heavy vehicles must be endorsed by DOT. Under special agreement with DOT, you have been granted permission to perform driving licence assessment endorsed by DOT. Upon completing the assessment paperwork for truck driving, the student must then present the relevant form and Certificate of Attainment, where applicable, to DOT which then issues the licence. There have been instances where refresher courses have been conducted for students who have already been issued with a licence. In principal the course is still the same in each scenario and they can be issued, but not always necessarily with a Certificate of Attainment. The students can still fail the course in that instance but it does not mean that they will lose their respective licence.


Relevant legislative provisions: A New Tax System (Goods and Services Tax) Act 1999 section 38-85 | A New Tax System (Goods and Services Tax) Act 1999 section 38-110 | A New Tax System (Goods and Services Tax) Act 1999 subsection 195-1

Reasons for decision: Detailed Reasoning - Questions 1 and 2: Section 38-85 of the GST Act provides that an education course is GST-free. The definition of education course in section 195-1 of the GST Act includes a professional or trade course. Goods and Services Tax Ruling GSTR 2003/1 (available from the legal database of www.ato.gov.au ) provides guidance on when a course meets the requirements of GST-free professional or trade course as defined in section 195-1 of the GST Act. Professional or trade courses are defined in section 195-1 of the GST Act to mean a course leading to a qualification that is an essential prerequisite: a) for entry to a particular profession or trade in Australia; or b) to commence the practice of (but not to maintain the practice of) a profession or trade in Australia. In relation to the entry to, or the commencement of the practice of a particular profession, section 195-1 of the GST Act provides that a qualification will be an essential prerequisite where: • the course is a legal requirement for example a law, regulation or industrial agreement, or • the course is a requirement imposed by a professional or trade association, either nationally or on a State basis. GSTR 2000/31 advises that a course that leads to a qualification that is an essential pre-requisite for maintaining or progressing within the practice of a profession or trade is not a professional or trade course. According to paragraph 99 in GSTR 2000/31, maintaining the practice of a profession or trade includes such things as: • undertaking continuing professional development; • re-licensing; • re-accreditation; • renewal of annual practising certificates; and • refresher course. Accordingly to be a GST-free professional or trade course a course must: i. lead to a qualification; and ii. the qualification is an essential prerequisite for entry to, or to commence the practice of a profession or trade in Australia. First requirement GSTR 2003/1 explains that documents that are qualifications or that provide evidence of a qualification include a statement of satisfactory completion, a certificate (including a degree or diploma), a licence or an accreditation. The first requirement will be satisfied where such documentation is awarded to the students undertaking your course upon successful completion of all of the units or modules that make up your course. Your course must provide the requisite skills and knowledge for an individual to attain the qualification at the conclusion of your course. Second requirement GSTR 2000/31 advised that a qualification is an essential prerequisite if it is mandatory for a person to have the qualification before he or she can enter into, or commence the practice of, a particular profession or trade. This necessarily requires the imposition of penalties or sanctions if a person enters into or commences the practice of, the profession without the relevant qualifications. The qualification must be a legal requirement, for example a law, regulation or industrial agreement to be one imposed by a professional or trade organisation, either nationally or on a State basis. A course that leads to a qualification that is an essential prerequisite for maintaining or progressing within the practice of a profession or trade is not a professional or trade course. Maintaining the practice of a profession or trade includes such things as: • undertaking continuing professional development; • re-licensing; • re-accreditation; • renewal of annual practising certificates; and • refresher course. | Detailed Reasoning - Question 1: From the information received, the course that you provide leads to the gaining of qualification legally required under the State Legislation for entry into or the commencement of an occupation as an operator. You also provide refresher courses to students who already hold a specialised licence. | Detailed Reasoning - Forklift course: In this instance, the course that you supply meets the requirements of a professional or trade course as defined in section 195-1 of the GST Act as: i. you issue the student undertaking your course with a Certificate of Attainment that certifies that they have undertaken and successfully complete your course. In this instance it is accepted that your course leads to a qualification. ii. You have advised that a Certificate of Attainment is a statutory requirement to receive a Worksafe card and operate heavy machinery in the State and the State legislation imposes penalties for failure to comply with that requirement. The qualification issued as a result of the course being undertaken is an essential prerequisite and the second requirement is satisfied. As your course meets the requirements of a professional or trade course as defined in section 195-1 of the GST Act, you are therefore making a GST-free supply of education course under section 38-85 of the GST Act. | Detailed Reasoning - Forklift refresher course: Your supply of refresher courses does not meet the requirements of a professional or trade course as defined in section 195-1 of the GST Act as the purpose for undergoing the refresher courses is to maintain the practice of operating the machinery. In this instance, you are not making a GST-free supply of education course under section 38-85 of the GST Act when you supply the refresher courses. Your supply will be subject to GST in this instance as you are registered for GST. | Detailed Reasoning - Question 2: From the information received, you provide heavy vehicle driving course and refresher courses to students who already hold a heavy vehicle driving licence. | Detailed Reasoning - Heavy vehicle driving course: First requirement From the information received, the student undertaking your heavy vehicle driving course receives a Certificate of Attainment after undergoing an assessment prescribed by TAC and National Standards. As this certificate certifies that they have undertaken and successfully complete your course, it is accepted that your course leads to a qualification. The first requirement is satisfied. Second requirement From the information received, it is mandatory to have a driving assessment done before a heavy vehicle licence can be issued to an applicant. The driving assessment can be done by you as an authorised assessor for DOT or by DOT. Driving assessment done by DOT It is not mandatory to have your course if the student is to have their driving assessment done by DOT. In this instance, your course is not a pre-requisite to obtain a heavy vehicle driving licence and commence an occupation as a heavy vehicle driver. As the second requirement is not met, the supply of your course is not a professional or trade course as defined in section 195-1 of the GST Act and therefore not GST-free under section 38-85 of the GST Act. Your supply will be subject to GST in this instance as you are registered for GST. Driving assessment done by you When you do the driving assessment, the Certificate of Attainment of your course is one of the documents to be submitted to DOT for the applicant to receive a driving licence from DOT. In this instance, the qualification issued as a result of your course being undertaken is an essential pre-requisite to obtain a heavy vehicle driving licence and commence an occupation as a heavy vehicle driver. As the second requirement is also satisfied, the supply of your course in this instance is a professional or trade course as defined in section 195-1 of the GST Act and therefore, is GST-free under section 38-85 of the GST Act. | Detailed Reasoning - Heavy vehicle driving refresher course: Your supply of heavy vehicle driving refresher course does not meet the requirements of a professional or trade course as defined in section 195-1 of the GST Act as the purpose for undergoing the refresher courses is to maintain the practice of driving a heavy vehicle. In this instance, you are not making a GST-free supply of education course under section 38-85 of the GST Act when you supply the heavy vehicle driving refresher course. Your supply will be subject to GST in this instance as you are registered for GST. | Detailed Reasoning - Question 3: Under subsection 38-110(1) of the GST Act a supply is GST-free is the supply is the assessment or issue of qualifications for the purpose of: a) access to education; or b) membership of a professional or trade association; or c) registration or licensing for a particular occupation; or d) employment. However, under subsection 38-110(2) of the GST Act, a supply is not GST-free under subsection 38-110(1) of the GST Act unless the supply is carried out by: a) a professional or trade association; or b) an education institution; or c) an entity that is registered by a training recognition authority of a State or Territory with the Australian Recognition framework to provide skill recognition (assessment only) services; or d) an authority of the Commonwealth or of a State or Territory; or e) a local government body. From the information received, you are an RTO that has been granted authority by DOT to carry on the heavy vehicle driving assessment endorsed by DOT where an applicant would like to have a heavy vehicle licence in order to work as a heavy vehicle driver. In this instance, your supply of driving assessment satisfies all the requirements for a GST-free supply under section 38-110 of the GST Act.