Annotated GST Act – Chapter 3 – Part 3-1- Division 38

Division 38 – GST-free supplies

38.1     What this Division is about

Subdivision 38A – Food

38.2     Food

Cases

Lansell House Pty Ltd v Commissioner of Taxation [2011] FCAFC 6 – the supply of a product known as a “Mini Ciabatte” was not GST-free as it was the supply of food within item 32 of Schedule 1 as a “cracker” – at [24]: the question as to  the characterisation or classification of a product is one of fact and degree and ‘is not one calling for or justifying over-elaborate, almost mind-numbing, legal analysis. It is a short practical question calling for a short practical answer’ – at [33]: the Court was satisfied that the product was “of a kind” of the cracker genus, taking into account the characteristics of the product and the general understanding of a cracker as a thing, crisp, dry, hard biscuit – First instance – [2010] FCA 329 (special leave refused – [2011] HCAT Trans 247)

Food Supplier and Commissioner of Taxation [2007] AATA 1550 – the supply of “free” promotional items with coffee is not GST-free but a separate taxable supply

International Cases

United Kingdom

Mucho Mas Ltd v Revenue and Customs [2016] UKFTT 302 – food zero rating – whether supplies pre October 2012 heated for the purposes of enabling food to be consumed at a temperature above the ambient air temperature – whether supplies after September 2012 kept hot after being heated – preliminary issue decided in favour of HMRC

The Frozen Fruit Company Ltd v Revenue and Customs [2016] UKFTT 12 – zero-rating – whether a frozen fruit dessert is zero rated as consisting overwhelmingly of frozen fruit or standard rated being “similar to” ice cream, ice lollies, frozen yoghurt and water ices – appeal dismissed

Bagel Nash Ltd v Revenue & Customs [2015] UKFTT 72 – zero rating – “consumption on the premises” – kiosk – food court – appeal dismissed

Sub One Limited T/A Subway v HMRC [2012] UKUT 34 – Value Added Tax – zero-rating – Value Added Tax Act 1994 Schedule 8 Part II Group 1 Note (3)(b)(i) – food – toasted sandwiches and meatball marinara – whether heated for the purposes of enabling it to be consumed at temperature above ambient air temperature – whether legislation and/or interpretation and/or application thereof infringed principle of fiscal neutrality – whether FTT findings irrational – application to adduce further evidence – Case analysis

Deliverance Ltd v HMRC [2011] UKUT 58 – zero–rating – food supplied for delivery–whether supplied above ambient temperature for the purpose of enabling it to be consumed hot or of demonstrating that it is freshly cooked- appeal allowed on the basis of the latter

Revenue and Customs v Proctor & Gamble UK [2009] EWCA Civ 407; [2009] STC 1990 – whether “pringles” are “similar to potato crisps and made from the potato” – whether error of law by Tribunal or question of fact – first instance – [2008] EWHC 1558

Marks and Spencer plc v Customs and Excise [2009] UKHL 8; [2009] STC 452; [2009] 1 All ER 939 – whether teacakes were biscuits

European Independent Purchasing Company Ltd v Revenue & Customs [2008] UKVAT V20697 – ZERO RATING – HOT FOOD CONSUMED OFF PREMISES – separate purposes for supplies of heated sandwiches – crisp up the bread for cold range – hot range for consumption hot – single purpose found – heating the sandwiches to be consumed hot – standard rate supplies – Appeal dismissed

General Mills UK Ltd v Revenue & Customs [2008] UKVAT V20905 – ZERO RATING – CONFECTIONARY – whether Crunchy Granola Bars biscuits – no – Appeal dismissed

H5 Ltd (t/a High Five) v Revenue & Customs [2008] UKVAT V20821 – VAT – ZERO RATING – CONFECTIONARY – high carbohydrate, low fat sports bar for seriously minded athletes – whether sports bar sweetened – satisfied that the bar could be described as sweet – sweetness derived from the principal and added ingredients – whether the sports bar confectionary – yes– Appeal dismissed

Quaker Trading Ltd v Revenue & Customs [2008] UKVAT V20604 – ZERO-RATING – EXCEPTED ITEM 5 – FOOD – Whether savoury jumbo Snack a Jacks when packaged for human consumption without further preparation – yes – Whether savoury mini and jumbo Snack a Jacks obtained by the swelling of cereals or cereal products – Yes – Appeal Dismissed.

Waterfield (Leigh) Ltd v Revenue & Customs [2008] UKVAT V20761 – zero rating- sale from hot beds of savoury products (ciabatta melts) – appeal allowed

Revenue and Customs v Premier Foods Ltd [2007] EWHC 3134 – whether supply of “fruit bars” are confectionery for purposes of VAT act

Bells of Lazenby Ltd v Revenue & Customs [2007] UKVAT V20490 – zero-rating — food product designed for allergy sufferers — presented as a bar containing cereals and fruits — whether properly categorised as cake — no — whether product “sweetened” — no — product nevertheless categorised as confectionery and standard-rated — appeal dismissed

Coffee Republic plc v Revenue & Customs [2007] UKVAT V20150 – Supply of hot toasties and of grilled panani – was it a supply in the course of catering or was the taxpayer’s purpose to enable the items to be consumed hot – appeal dismissed

Premier Foods (Holdings) Ltd v Revenue & Customs [2007] UKVAT V20072 – ZERO-RATING – Food – Fruit bars – Whether confectionery so excluded from zero-rating – Manufacture involved neither sweetening nor cooking – Tangy taste – Popcorn House Ltd [1968] 3 All ER 782 per Lawton J applied – Appeal allowed

Unilever Bestfoods UK Ltd v Revenue & Customs [2007] UKVAT V20016 – ZERO-RATING – Food – Excepted item – Knorr Vie shots – Whether food – Yes – Whether “Excepted” as being beverage – No –

Revenue and Customs v Compass Contract Services UK Ltd [2006] EWCA 730 – whether sale of cold prepared food zero rated as supplies of food, whether supplies in the course of catering

Ainsley’s of Leeds Ltd v Revenue & Customs [2006] UKVAT V19694 – zero-rating — sale from hotbeds of baked savoury product (ciabatta melts) — appeal allowed

Jannicke Wallace (t/a The Cornish Pastry) v Revenue & Customs [2006] UKVAT V19793 – ZERO-RATING – Hot food – pasties baked in oven – some placed in a heated cabinet others placed in wicker baskets and on trays – whether the pasties destined for the heated cabinet were heated for the purpose of enabling them to be consumed hot – satisfied on the evidence that the Appellant’s predominant purpose was to heat them to be consumed hot – Appeal dismissed

Pret A Manger (Europe) Ltd v Revenue & Customs [2006] UKVAT V19755 –  zero-rating — supplies of cold food from outlets within larger building — whether supplies made “in the course of catering” — meaning of “catering” — supplies not made in the course of catering — whether food to be consumed “on the premises” — Note (3) to Item — food not consumed on premises of supply — appeal allowed

QSR Ltd (t/a First Taste) v Revenue & Customs [2006] UKVAT V19528 – supplies of sandwiches and cold food to offices and within units in multi-occupancy buildings – whether supplies made “in the course of catering” or ” food for human consumption” – meaning of “catering” and exceptions – supplies not made in the course of catering as to sandwiches and cold food – yes as to business lunches – whether the food to be consumed “on the premises” –food not consumed on premises – appeal allowed

Warren (t/a W T Warren & Son) v Revenue & Customs [2006] UKVAT V19902 – ZERO-RATING – sale of hot “paninis” – whether supplies in the course of catering – whether “paninis” heated for the purposes of enabling them to be consumed off the premises – no – “paninis” found to have been grilled in-shop for the purpose of completing baking process commenced elsewhere – supplies held to be zero-rated – appeal allowed

Banks v Customs & Excise [2005] UKVAT V18904 – VAT – Zero-rating – Group 1 Schedule 8 – Food – Linseed Oil – Not food but supplement so Standard rated

Canada

IKE Enterprises Inc v The Queen 2017 TCC 59 – whether food products described as crystallised ginger, granola and sticks (made of wheat, rice and spelt) were zero rated as the supply of “basic groceries”  held – crystallised ginger and granola was zero rated, the sticks were taxable

Kandawala v The Queen 2004 TCC 659 – whether “paan leaves” is zero rated as a “basic grocery” as a “supply of food or beverage for human consumption” – at [14]: consideration of several factors to determine whether a particular food item was excluded

Aliments Koyo Inc v The Queen 2004 TCC 286 – whether a “strawberry-flavoured soy beverage” was a zero rated supply

Rulings and Determinations

GSTD 2008/2 – Austlii – Goods and services tax: are supplies of food known as breakfast bars GST-free?

GSTD 2002/2 – Austlii – Goods and services tax: what supplies of fruit and vegetable juices are GST-free?

38.3     Food that is not GST-free

Schedules to GST Act

Schedule 1 – Food that is not GST-free

Schedule 2 – Beverages that are GST-free

Cases

JMB Beverages Pty Ltd v Commissioner of Taxation [2010] FCAFC 68 – alchohol free wine was not GST-free as the sale of non-alchoholic beverages consisting wholly or at least 90& by volume of juices of fruits or vegetables – the process of fermentation changed the nature of the components and as a result juices of fruits (grapes) were no longer present – first instance – [2009] FCA 668

P & N Beverages Australia v Federal Commissioner of Taxation [2007] NSWSC 338 – sale of carbonated fruit juice drink not GST free as the sale of beverage consisting “wholly of juices of fruits” where the drinks contained 98% to 99% fruit juice and 1% – 2% additives – at [23]-[31]: whether “juices of fruits” takes ordinary or trade meaning -“wholly” means 100%

Cascade Brewery Company Pty Limited v Commissioner of Taxation [2006] FCA 821 – whether the sale sale of concentrated fruit juice syrup GST-free as a beverage of a kind in Item 13 being a “beverage of a kind marketed principally as food for infants” – at [12]-[22]: discussion of meaning “of a kind” – at [27]-[40]: meaning of “infants” and whether take ordinary meaning

International Cases

The Mark Anthony Group Inc v The Queen 2017 TCC 141 – whether cider containing a small amount of apple juice concentrate made from apples grown outside Canada – and added after fermentation of the cider but before packaging – fell within the exemption for cider produced in Canada and composed wholly of agricultural or plant products grown in Canada – solely a question of statutory construction – appeal allowed

Chi Drinks Ltd v Revenue & Customs [2013] UKFTT 94 – VAT – zero rating – food – coconut water – is it a beverage? – yes – supplies held to be standard rated

Glaxosmithkline Services Unlimited v HMRC [2011] UKUT 432 – zero-rating – Whether “Lucozade Sport” zero-rated as food or standard-rated as beverage

Thorcroft Ltd v Revenue & Customs [2011] UKFTT 694 – whether iced tea concentrate zero rated as a “tea, mate, herbal teas and similar products and preparations and extracts thereof” or standard rated

Ocean Grown UK Ltd v Revenue & Customs [2008] UKVAT V20562 –  zero-rating – Wheatgrass – Whether zero-rated as food or standard-rated as a beverage – Bioconcepts Ltd and Kalron Goods Ltd considered – No – Appeal allowed

R Twining and Company Ltd v Revenue & Customs [2007] UKVAT V20230 – value added tax – zero-rating – whether product a powder for the preparation of beverages – whether product a preparation or extract of milk – meaning of milk considered

Kalron Foods Ltd v Revenue & Customs [2006] UKVAT V19738 – ZERO-RATING – food, etc – whether “Zumo Fresh Blend” a beverage – yes – product consumed as a beverage notwithstanding its status as food – observations as to position where product constitutes both food of a kind used for human consumption and a beverage – product supplied as an excepted item and hence not zero-rated – appeal dismissed

GST Regulations

38.3.01   GST-free beverages supplied from vending machines

38.3.02   Food additives

38.4     Meaning of food

38.5     Premises used in supplying food

Rulings and Determinations

GSTD 2000/5 – Austlii – Goods and services tax: when is a supply of food, in terms of paragraph 38-3(1) of the GST Act ‘for consumption on the premises from which it is supplied’?

38.6     Packaging of food

Rulings and Determinations

GSTD 2000/6 – Austlii – Goods and services tax: when is the supply of food packaging GST-free in terms of section 38-6 of the GST Act?

Subdivision 38B – Health

38.7     Medical services

International Cases

City Fresh Services Ltd v Revenue & Customs [2015] UKFTT 364 – Supply of medical care-dentists supplying services from company via partnership to NHS Trust – standard rated supply of staff or exempt supply of medical care – held – supply of medical care –number of suppliers in chain did not change nature of supply – no evidence that partnership exercised control over dentists’ work activities – appeal allowed.

GSTS Pathology Services LLP v Revenue & Customs [2014] UKFTT 211 – exemption – medical care – analysis of medical samples – service supplied to medical institution or practitioner, not to patient – whether exempt

MJ Fenwick Consultancy v Revenue & Customs [2013] UKFTT 598 – Exemption – Provision of services by private addiction therapist not registered or enrolled on register or roll of health professionals  – Whether services supplied are directly supervised by such a health professional – No – Appeal dismissed

Rapid Sequence Ltd v Revenue & Customs [2013] UKFTT 432 – exemption for medical care – whether applies to services provided by company acting as a principal in providing medical doctors on a locum basis to hospitals – no – Article 132(1)(c) Principal VAT Directive – Schedule 9 Group 7 Item 5 Value Added Tax Act 1994 – appeal dismissed

Sally Moher at Premier Dental Agency v HMRC [2012] UKUTB2 – exemptions – appellant engaged dental nurses and supplied them as temporary staff to dentists – whether appellant made supplies of staff or of medical treatment – supplies of staff – supplies standard-rated – appeal dismissed

Future Health Technologies Ltd v Revenue & Customs [2009] UKVAT V20963 – VAT – Principal VAT Directive of 28 November 2006 article 132.1 (b) and (c) – whether services of collecting, testing, processing and storage of umbilical cord blood stem cells for future therapeutic use exempt from VAT in whole or in part – reference to European Court of Justice

E Moss Ltd v Revenue & Customs [2006] UKVAT V19510 – exempt supplies – health and welfare – services supplied by chiropodists who were not registered – whether services directly supervised by a person who was registered – mostly yes – appeal on this issue allowed in principle

In Health Group SA Public Body and Hospital v Revenue & Customs [2006] UKVAT V19593 – Provision of MRI data – Exempt as medical care Article 13A(1) and (2) or standard-rated – held standard-rated

38.10   Other health services

Cases

Acquatic Air Pty Limited v Siewert [2015] NSWSC 928 – supply of air ambulance services was GST-free notwithstanding that the supplier did not have a statutory licence to provide ambulance services – supply is GST-free regardless of whether the supply is made to the hospital or the patient – case analysis

International Cases

Jigsaw Medical Services Ltd v Revenue & Customs [2017] UKFTT 537 – whether supplies of ambulance services exempt or zero rated as transport services – held exempt

38.15   Other government funded health services

38.20   Hospital treatment

Rulings and Determinations

GSTD 2012/4 “Goods and Services tax: what is ‘hospital treatment’ for the purposes of section 38-20 of the GST Act”

38.25   Residential care etc

International cases

Elim Housing Society v The Queen 2015 TCC 282 – whether taxpayer entitled to rebate in respect of residential care facilities operated by the taxpayer – whether the supplies by the taxpayer were part of a medically necessary process of health care

Age Concern Leicestershire & Rutland v Revenue & Customs [2008] UKVAT V20762 -EXEMPTION – service supplied by the Appellant for the benefit of the elderly – whether supplied to the local authority / PCT or to the elderly – whether services constitute welfare services – yes – appeal dismissed

Rulings and Determinations

GSTD 2011/4 – Goods and services tax: Are accommodation bond retention amounts or accommodation charges paid by, residents of an aged care facility covered by the Aged Care Act 1997, that is supplying GST-free services under subsection 38-25(1) of the A New Tax System (Goods and Services Tax) Act 1999, consideration for a GST-free supply?

38.30   Home care etc

38.35   Flexible care

38.38   Disability support provided to NDIS participants

38.40   Specialist disability services

38.45   Medical aids and appliances

Cases

Snugfit Australia Pty Ltd and Commissioner of Taxation [2013] AATA 802 – the supply of a product known as a “SnoreBeGone” sleep positioning system was GST-free under s 38-45(1) of the GST Act as a supply of a medical aid or appliance 

International Cases

Iansyst Ltd v Revenue and Customs [2016] UKFTT 372 – Zero-rating for equipment or appliances designed solely for use by handicapped persons– whether mobile device with software installed met the requirements – yes, appeal allowed

Concept Multi Car Ltd v Revenue & Customs [2014] UKFTT 110 – Zero rating- whether camper vans converted from VW T5 motor vans supplied to disabled customers by appellant were adapted “permanently and substantially” to enable a disabled person who usually used a wheel chair  “to enter and drive or otherwise be carried in” the vehicle – combination of adaptations consisting of ambulance ramp fitting strip and swivel seats fulfilled criteria – appeal allowed

HMRC v The British Disabled Flying Association [2013] UKUT 162 – zero rating – aircraft for use by disabled persons – whether aircraft modified for use by disabled persons after manufacture are ” designed” for such use – held yes but one aircraft not so designed at time of supply – whether Respondent is a ” relevant establishment” for the purposes of Group 15 to Schedule 8 VAT Act 1994 – held no – whether Tribunal has jurisdiction to decide whether appellant had legitimate expectation – held no – appeal allowed in relation to one aircraft and dismissed in relation to the other

John Martin Holdings Ltd v Revenue & Customs [2013] UKFTT 714  – Zero rating of the supply of a qualifying motor vehicle for handicapped person who usually uses a wheelchair.  Whether supply made to handicapped person/disabled wheelchair user for domestic or personal use – whether sufficient evidence available to supplier to allow zero rating of supply – Appeal dismissed.

Bunning (t/a Stafford Land Rover) v Revenue & Customs [2012] UKFTT 32 – zero-rating of the supply of a qualifying motor vehicle to a handicapped person who usually uses a wheelchair – whether two vehicles supplied were each (a) supplied to a handicapped person who usually uses a wheelchair, and (b) a qualifying motor vehicle – held in both cases both conditions were fulfilled and the supplies fell to be zero-rated – appeal allowed

The British Disabled Flying Association v Revenue & Customs [2011] UKFTT 743 – whether aircraft for use of disabled persons zero rated

Croall Bryson & Company Ltd v Revenue & Customs [2011] UKFTT 494 – Zero Rating – Whether motor vehicle “substantially and permanently adapted for a handicapped person who usually uses a wheelchair” – whether for domestic and personal use to enable a handicapped person to enter and drive in a motor vehicle

Made to Measure v Revenue and Customs [2011] UKFTT 154 – zero rating – aids for the handicapped – electromagnetic wave pads and mattresses – whether beds or appliances designed solely for invalids or used by handicapped persons

Horstead v Revenue & Customs [2006] UKVAT V19697 – ZERO-RATING – transport – Vauxhall Corsa supplied with automatic transmission, air conditioning and power steering but not otherwise modified for use by a disabled person – whether vehicle designed or substantially and permanently adapted for the carriage of a person in a wheelchair – whether supply should be zero-rated – no – appeal dismissed

Lonie v Revenue & Customs [2006] UKVAT V19901 – zero-rating — equipment designed for handicapped persons — chair with electrically operated reclining back rest — whether “designed solely for use by a handicapped person” — no — appeal dismissed

Schedule to GST Act

Schedule 3 – medical aids and appliances

GST Regulations

38.45.01   Medical aids and appliances

Schedule 3 – medical aids and appliances

38.47   Other GST-free health goods

38.50   Drugs and medicinal preparations etc

38.55   Private health insurance etc

38.60   Third party procured GST-free health supplies

Subdivision 38C – Education

38.85   Education courses

International Cases

SAE Education Ltd v Revenue and Customs [2017] EWCA Civ 1116 – exempt supplies — education – whether education provided by “eligible body” — whether respondent a college of a university — tests to be applied – appeal dismissed for different reasons of the Upper Tribunal – see Revenue & Customs v SAE Education Ltd [2016] UKUT 193

Revenue and Customs v Brokenhurst College [2015] EWCA Civ 1196 – whether the supplies, made by a College offering courses in catering and hospitality and performing arts, of restaurant and entertainment services (being supplies to members of the public dining in the restaurant or attending performances) was exempt as being “closely related” to the provision of education or standard rated – referred to ECJ

Alexander College Corp v The Queen 2015 TCC 238 – whether the taxpayer was a “university” as defined in s 123(1) of the Excise Tax Act, being “a recognised degree-granting institution or organisation that operates as a college affiliated with, or a research body of, such an institution”

Revenue & Customs v The Open University [2015] UKUT 263 – whether services supplied by BBC to Open University exempt under Article 13A(1)(i) of the Sixth VAT Directive – appeal on law from decision of First-tier Tribunal that services were exempt – was BBC a body governed by public law? – no – did BBC have educational aim required by Article 13A(1)(i)? – yes – was BBC other organisation defined by United Kingdom as having similar objects? – yes – appeal dismissed

SAE Education Ltd v Revenue & Customs [2014] UKFTT 218 – Exemption – Company providing educational courses to students – succession of agreements between company and university – whether supply of educational courses by company exempt – whether courses supplied by eligible body – whether company a college of a university – VATA 1994 Sch 9, Group 6, Item 1, Note (1)(b) – EC Council Directive 2006/112, Art 132(1)(i) – appeal allowed

Finance & Business Training Ltd v Revenue & Customs [2013] UKUT 594  – whether Appellant was “an eligible body” within Note (1)(b)- whether Appellant was a college or institution of the University of Wales – whether possible to be an eligible body in relation to some of the Appellant’s activities and not an eligible body in relation to the remainder of its activities – first instance  [2012] UKFTT 382

London College of Computing Ltd v HMRC [2013] UKUT 404 – Exempt supplies – education – whether provided by “eligible body” – whether college of a university – tests to be applied – appeal dismissed

Westminster College of Computing Ltd v Revenue & Customs [2012] UKFTT 579 – EXEMPT SUPPLIES – education – whether appellant school – held no – whether appellant college of institution of UK university– held no – appeal dismissed

HIBT Ltd v Revenue & Customs [2007] UKVAT V19978 – Exemptions – Education – Company in the business of providing educational courses to fee-paying students – Recognition Agreement between company and university – Whether supply of educational courses by company exempt – Whether educational courses supplied by eligible body – Whether company a college of a university – appeal allowed

Rulings and Determinations

GSTR 2003/1 – Austlii – Goods and services tax: supplies that are GST-free as professional or trade courses

GSTR 2002/1 – Austlii – Goods and services tax: supplies that re GST-free as special education courses

GSTR 2001/1 – Austlii – Goods and services tax: supplies that are GST-free for tertiary education courses

GSTR 2000/30 – Austlii – Goods and services tax: supplies that are GST-free for pre-school, primary and secondary education courses

GSTR 2000/27 – Austlii – Goods and services tax: adult and community education courses; meaning of “likely to add to employment related skills”

GSTD 2000/11 – Austlii – Goods and services tax: is the supply of commercial pilot training GST-free as an education course under section 38-85 of the GST Act?

GSTD 2000/7 – Austlii – Goods and services tax: is the supply of the services of apprentices or trainees by a Group Training Company to host employers under a Group Training Scheme a taxable supply in terms of section 9-5 of the GST Act?

38-90   Excursions or field trips

38.95   Course materials

38.97   Lease etc of curriculum related goods

38.100 Supplies that are not GST-free

38.105 Accommodation at boarding schools etc

38.110 Recognition of prior learning etc

Subdivision 38D – Child care

38.140 Child care – registered carers under family assistance law

38.145 Child care – approved child care services under the family assistance law

38.150 Other child care

38.155 Supplies directly related to child care that is GST-free

International cases

Caithkin Inc v The Queen 2015 FCA 118 – whether the supply of services by the taxpayer to various Children’s Aid Societies (being the location and training of foster parents and inspection of foster care homes) qualified as an exempt supply – whether the primary judge correct to restrict the exemption to a supply of services in the actual, physical locations or home where foster children resided

Rulings and Determinations

GSTD 2001/1 – Austlii – Goods and services tax: what is the GST treatment of the administration levy paid by parents and carers to a Family Day Care Scheme and Child Care benefits paid to carers by a Family Day Care Scheme on behalf of parents?

Subdivision 38E – Exports and other supplies for consumption outside Australia

38.185 Exports of goods

Cases

Mackay and Commissioner of Taxation [2011] AATA 593 – applicant supplying hunting expeditions to foreign clients was not the “exporter” of treated animal carcases that guests hunted down as trophies – at [16]: applicant not the exporter of the goods – at [17]: applicant not deemed to be exporter because documents not provided showing goods entered for export

International Cases

Open Safety Equipment Ltd v Revenue and Customs [2017] UKFTT 261 – whether goods exported – whether the requirement for export applies in cases where no export from the UK occurred – no – appeal allowed in part

HMRC v Arkeley Limited (in liquidation) [2013] UKUT 393 – VAT – zero-rating – evidence of export of goods – whether First-tier Tribunal erred in law in finding that the conditions for zero-rating were met in respect of certain invoices – appeal dismissed

Brendan McMahon v HMRC [2012] UKUT 106 – VALUE ADDED TAX – evidence of export – whether First-tier Tribunal applied correct legal test – despite incorrect statement, yes – whether tribunal’s findings of fact supported by evidence – yes – appeal dismissed

Keen Jewellery Ltd v Revenue & Customs [2007] UKVAT V20096 – ZERO-RATING – Proof of export – Channel Islands – Pearl necklace taken to Channel Islands and sold there – No SAD – Whether alternative evidence of export is acceptable – No

Rulings and Determinations

GSTR 2002/6 – Austlii – Goods and services tax: exports of goods, items 1 to 4 of the table in subsection 38-185(1) of the A New Tax System (Goods and Services Tax) Act 1999

GST Regulations

38.185.01   Export of goods by travellers as accompanied baggage

Schedule 5  Rules for the supply of goods to a relevant traveller

38.187 Lease etc of goods for use outside Australia

38.188 Tooling used by non-residents to manufacture goods for export

38.190 Supplies of things, other than goods or real property, for consumption outside Australia

Cases

Levy v Bergseng [2008] NSWSC 294 – costs – costs assessment –  construction of costs agreements – applicability of GST to barrister’s fees payable by solicitor where client is overseas resident.

Travelex v Commissioner of Taxation [2010] HCA 33 – supply of foreign currency on the departure side of the customs barrier at the airport was GST-free as a supply in relation to rights for use outside Australia – at [27]: when the supplier sells the foreign currency to the acquirer, the acquirer obtains the rights that attach to, or are constituted by, the ability to use the currency. Because the supply is a supply of property in the currency, the supply is a supply “in relation to” the rights that attach to the currency, without which property in the currency would be worthless
Fiduciary Ltd v Morningstar Research Pty Ltd [2004] NSWSC 381 – supply of legal services to US company for legal proceedings in Australia a GST-free supply to non-resident within item 2 in the table – at [45]: the presence of directors of the US company in Australia for the hearing was not sufficient to make the company “in Australia” when the services were supplied
International Cases
Tele-Mobile Company v The Queen 2015 TCC 197 – whether the supply of a telecommunication service of roaming airtime in the US was part of a single supply of telecommunication services which included long distance calls from the US to Canada or a separate supply taking place entirely in the US
Tanjoukian v HMRC [2012] UKUT 36 – Sale of vehicle registration marks – Whether transaction zero rated as an international supply – Place of supply in UK – Whether transaction involving a transfer or assignment of rights within para 1 of schedule 5 to VATA 1994 – Whether the DVLA a taxable person – Whether sale of registration marks by the DVLA an economic activity – Appeal dismissed

Ist Contact Ltd v Revenue & Customs [2012] UKFTT 84 – recovery of input tax on exempt supplies pursuant to VATA s.26(2)(c) – Exempt supplies under VATA Schedule 9, Group 5, item 1 (“The issue, transfer or receipt of, or any dealing with, money, any security for money or any note or order for the payment of money”) – Supply of foreign exchange services (FOREX) to persons, principally from Australia, New Zealand and South Africa, who are in the United Kingdom on a “working holiday” or “overseas experience” – whether services “supplied to a person who belongs outside the member States”

SWS Communications Inc v The Queen 2012 TCC 114 – whether supply of telecommunication services zero-rated as an export to non-resident – whether supplier had a permanent establishment in Canada

Rulings and Determinations

GSTD 2015/1 – Goods and services tax: is the supply of brokerage services that facilitates the sale or purchase of financial products on overseas securities or futures exchanges, a GST-free supply under paragraph (a) of item 4 in the table in subsection 38-190 of the GST Act?

GSTR 2007/2 – Austlii – Goods and services tax: in the application of paragraph (b) of item 3 in the table in subsection 38-190(1) of the A New Tax System (Goods and Services Tax) Act 1999 to a supply, when does ‘effective use or enjoyment’ of the supply ‘take place outside Australia’

GSTD 2007/3 – Austlii – Goods and services tax: if a non-resident entity owns residential rental premises in Australia and an Australian accountant makes a supply to that entity consisting of advice about the premises and tax return preparation services, is that supply wholly or partly GST-free if made on or after 1 April 2005?

GSTD 2006/2 – Austlii – Goods and services tax: does an Australian entity make a taxable supply when it supplies repair services under a warranty given by a non-resident manufacturer?

GSTD 2006/1 – Austlii – Goods and services tax: is a payment from a non-resident car manufacturer to an Australian distributor under an offshore warranty chargeback arrangements subject to GST

GSTR 2005/6 – Austlii – Goods and services tax: the scope of subsection 38-190(3) and its application to supplies of things (other than goods or real property) made to non-residents that are GST-free under item 2 in the table under subsection 38-190(1) of the A New Tax System (Goods and Services Tax) Act 1999

GSTR 2005/2 – Austlii – Goods and services tax: supplies of goods and services in the repair, renovation, modification or treatment of goods from outside Australia whose destination is outside Australia

GSTR 2004/7 – Austlii – Goods and services tax: in the application of items 2 and 3 and paragraph (b) of item 4 in the table in subsection 38-190(1) of the A New Tax System (Goods and Services Tax) Act 1999

GSTR 2003/8 – Austlii – Goods and services tax: supply of rights for use outside Australia – subsection 28-190(1), item 4, paragraph (a) and subsection 38-190(2)

GSTR 2003/7 – Austlii – Goods and services tax: what do the expressions ‘directly connected with goods or real property’ and ‘supply of work physically performed on goods’ mean for the purposes of subsection 38-190(1) of the A New Tax System (Goods and Services Tax) Act 1999?

Subdivision 38F – Religious services

38.220 Religious services

International Cases

Church of Scientology Religious Education College Inc v Revenue & Customs [2014] UKFTT 1064 – VAT – supplies of services by mother church of Scientology religion to churches in the UK – whether single supply or multiple supplies – whether exempt as educational services or standard rated as governance and ecclesiastical management services

Subdivision 38G – Activities of charities etc

38.250 Nominal consideration etc

Cases

Study and Prevention of Psychological Diseases Foundation v Commissioner of Taxation [2015] FCA 1117 – whether the Commissioner properly revoked the endorsement of the applicant as a “charitable institution” under s 176(1) of the GST Act – discussion of the meaning of the words “charitable institution”

Rulings and Determinations

GSTD 2013/4 ‘Goods and services tax: where capital assets that diminish in value over time are utilised in making a supply, can the consideration provided by the supplier to acquire those assets be taken into account in determining whether the supply is GST-free under subparagraph 38-250(2)(b)(ii) of the A New Tax System (Goods and Services Tax) Act 1999

38.255 Second-hand goods

38.260 Supplies of retirement village accommodation etc

38.270 Raffles and bingo conducted by charities etc

Subdivision 38I – Water, sewerage and drainage

Rulings and Determinations

GSTR 2000/25 – Austlii – Goods and services tax: GST-free supplies of water, sewerage and sewerage-like services, storm water draining services and emptying of a septic tank

38.285 Water

38.290 Sewerage and sewerage-like services

38.295 Emptying of septic tanks

38.300 Drainage

Subdivision 38J – Supplies of going concerns

38.325 Supply of a going concern

Cases

The Hotel Apartment Purchaser and Commissioner of Taxation [2013] AATA 567 – the seller of a serviced apartment in a hotel complex was carrying on an enterprise of owning the apartment, leasing it to the management company and participating in a serviced apartment business – the seller supplied all of the things necessary for the continued operation of the enterprise – at [34]: to answer 38-325(2)(a) requires an identification of the enterprise carried on – (Case analysis)

Brookdale Investments Pty Ltd and Commissioner of Taxation [2013] AATA 154 –  the applicant failed to establish that it had “agreed in writing” that the sale of land was of a going concern – provision of statutory declarations after the supply insufficient – at [47]: the agreement must be made at or prior to the making of the supply – (Case analysis)

Cyonara Snowfox Pty Ltd v Commissioner of Taxation [2012] FCAFC 177 –  the applicant did not establish that it was carrying on an enterprise of leasing up to the day on which the real property was supplied – the decision of the tribunal was open on the evidence – tribunal [2011] AATA 124

Aurora Developments Pty Ltd v Commissioner of Taxation [2011] FCA 232 – the sale of real property by the taxpayer was not GST-free as the supply of a going concern because as at the date of supply the taxpayer had abandoned its project of property development on the land and in its place decided to sell the land – at [5]: the parties the parties to an agreement cannot, by agreement, determine that a particular supply is GST-free for the purposes of the GST Act. That is a conclusion which arises as a matter of law having regard to the factual foundation for the operation of the statutory integers properly construed – at [253]-[254]: the particular enterprise carried on must be identified and that identified enterprise must be carried on until the day of supply

South Steyne Hotel Pty Ltd v Commissioner of Taxation [2009] FCAFC 155 – sale of residential apartment subject to lease was the supply of a going concern – parties agreed in writing notwithstanding conflicting conflicting terms of contract – clear terms of agreement to be preferred – first instance [2009] FCA 13

YXFP and Commissioner of Taxation [2009] AATA 805 – sale of land under standard contract of sale not the supply of a going concern because the parties did not agree in writing – absence of any written recording of any mutual understanding that the supply was of a going concern

Debonne Holdings Pty Ltd and Commissioner of Taxation [2006] AATA 886 – sale of land and business by two interrelated contracts but only sale of business expressed to be the supply of a going concern – sale of land also the supply of a going concern because part of one dealing

Midford v FC of T [2005] AATA 623 – whether the parties agreed in writing that the sale was the supply of a going concern – what constitutes an “agreement in writing” – the parties must expressly agree in writing and it is not sufficient that what the parties contracted for was the supply of a going concern.

International Cases

Gala Leisure Ltd v Revenue & Customs [2015] UKFTT 516 – entitlement to claim repayment of overpaid VAT – effect of companies leaving VAT groups on entitlement to claim – whether representative member or generating member entitled to claim – held representative member so entitled – appeal dismissed

Amor Interiors Ltd v Revenue & Customs [2015] UKFTT 358 – INPUT TAX – whether sale of assets to the appellant was the transfer of a business as a going concern and not to be treated as a supply of goods – appeal dismissed

Intelligent Managed Services Ltd v Revenue and Customs [2015] UKUT 0341 – whether transfer of a business to a company that was a member of a VAT group was a transfer of a going concern (TOGC) – after transfer supplies made only to other group company

Revenue & Customs v Royal College of Pediatrics and Child Health [2015] UKUT 38 – sale of freehold property with an agreement for a tenancy – tenant introduced by purchaser – whether transfer of a going concern

Massey (t/a The Basement Restaurant) v Revenue & Customs [2013] UKFTT 102 – Transfer of going concern – Restaurant premises reverting to Landlord on termination of tenancy – purchase of  assets by the Landlord – was there a transfer of a going concern – yes – Appeal dismissed

3 Net Media Group v Revenue & Customs [2011] UKFTT 266 – transfer of assets – whether transfer of going concern

Tepe Holdings Limited v Commissioner of Inland Revenue [2011] NZCA 534 – whether sale of shares in company zero-rated as the sale of a going concern – judgment appealed from – [2010] NZHC 1663; (2010) NZTC 24,551

Cockburn v C S Development No 2 Limited [2010] NZCA 37 – whether agreement the sale of going concern – application for leave to appeal denied – [2010] NZSC 139

J & S Pubs Ltd v Revenue & Customs [2008] UKVAT V20855 – transfer of going concern: Transfer of Tenants Fixtures and Fittings to Landlord: Unusual commercial transaction.

Royal Bank of Scotland Group plc v Revenue & Customs [2008] UKVAT V20856 – TRANSFER OF A GOING CONCERN – initial transfer not qualifying, subsequently novated in circumstances which qualified – whether treatment applicable to subsequent payments treated as separate supplies – subsequent payments not consideration for the sale of business so the issue did not arise

Nicholas Spence v Revenue & Customs [2008] UKVAT V20563 – Transfer of a going concern – Assets and premises reverting to landlord on termination of tenancy – The only assets actually transferred being minor – Held: not a transfer of a going concern

Dartford Borough Council v Revenue & Customs [2007] UKVAT V20432 – TRANSFER OF A GOING CONCERN – local authority entering into development agreement and agreement for lease with a tenant and then selling freehold interest – whether business of purchaser different – no – appeal allowed

Harrison v Revenue & Customs [2007] UKVAT V20392 – transfer of going concern — public house — whether transferred as going concern by previous tenant / licensee where he vacated property prior to it being sold by its then landlord to appellant’s landlord with fixtures and fittings and appellant’s landlord sold on fixtures and fittings to appellant — appellant paid nothing for goodwill and had no contact with previous tenant / licensee — finding that transfer was of assets not of going concern — appeal allowed

Morton Hotels Ltd v Revenue & Customs [2007] UK VAT V20039 – Value Added Tax – whether “transfer of a going concern” – sale of hotels with licences, stock, goodwill etc – purchase financed by sale and leaseback of heritage – Appeal allowed

Tezgel (t/a Master Chef) v Revenue & Customs [2007] UKVAT V20462 – whether a transfer of a restaurant qualified as a transfer as a going concern – Appeal Dismissed

MPH Leisure Ltd v Revenue & Customs [2006] UKVAT V19778 – TRANSFER OF GOING CONCERN – Appellant took out a lease for ten years in respect of a private members club – the Appellant was not the purchaser of the club – the previous business ceased trading on 4 November 2004 with the Appellant re-opening for business on 5 November 2004 – satisfied no break in trading and no fundamental change in the nature of the business – the Appellant was put in possession of a going concern – Appeal dismissed.

Fatax Limited (in liquidation) v Commissioner of Inland Revenue [2002] NZCA 269 – sale of going concern, whether supply of tenancy or licence, whether agreement in writing

Svenska International Plc v Commissioners of Customs and Excise [1999] UKHL 23; [1999] 2 All ER 906; [1999] 1 WLR 769 – VAT group, input tax credits, time of supply

Commissioners of Customs and Excise v Thorn Materials Supply Ltd and Thorn Resources Ltd [1998] UKHL 23; [1998] 3 All ER 342 – treatment of transactions between members of VAT Group on entry into contract but not grouped on completion, time of supply

Rulings and Determinations

GSTR 2004/9 – Austlii – Goods and services tax: GST consequences of the assumption of vendor liabilities by the purchaser of an enterprise

GSTR 2002/5 – Austlii – Goods and services tax: when is a ‘supply of a going concern’ GST-free?

Subdivision 38K – Transport and related matters

38.355 Supplies of transport and related matters

Rulings and Determinations

GSTR 2003/4 – Austlii – Goods and services tax: stores and spare parts for international flights and voyages

GSTR 2000/33 – Austlii – Goods and services tax: international travel insurance

38.360 Travel agents arranging overseas supplies

Subdivision 38L – Precious metals

38.385 Supplies of precious metals

Rulings and Determinations

GSTR 2003/10 – Austlii – Goods and services tax: what is ‘precious metal’ for the purposes of GST

Subdivision 38M – Supplies through inwards duty free shops

38.415 Supplies through inwards duty free shops

Subdivision 38N – Grants of land by governments

38.445 Grants of freehold and similar interests by governments

Rulings and Determinations

GSTR 2006/6 – Austlii – Goods and services tax: improvements on the land for the purposes of Subdivision 38-N and Division 75

GSTR 2006/5 – Austlii – Goods and services tax: meaning of ‘Commonwealth, a State or a Territory’

38.450 Leases preceding grants of freehold and similar interests by governments

Subdivision 38O – Farm land

38.475 Subdivided farm land

38.480 Farm land supplies for farming

Rulings and Determinations

GSTD 2011/2 – Goods and services tax: can a ‘farming business’ be carried on, for the purposes of paragraph 38-480(a) of the GST Act where there has been a cessation of routine farming activities by the supplier for a period of time as a consequence of a decision to sell the land?   See my discussion of this determination here

Subdivision 38P – Cars for use by disabled people

38.505 Disabled veterans

38.510 Other disabled people

International Cases

Concept Multi Car Ltd v Revenue & Customs [2014] UKFTT 110 – VAT – Zero rating- whether camper vans converted from VW T5 motor vans supplied to disabled customers by appellant were adapted “permanently and substantially” to enable a disabled person who usually used a wheel chair  “to enter and drive or otherwise be carried in” the vehicle for the purposes of Note 5L to Item 2A Schedule 8 Group 12 VATA 1994 – combination of adaptations consisting of ambulance ramp fitting strip and swivel seats fulfilled criteria – appeal allowed

Bunning (t/a Stafford Land Rover) v Revenue & Customs [2012] UKFTT 32 – zero-rating of the supply of a qualifying motor vehicle to a handicapped person who usually uses a wheelchair – whether two vehicles supplied were each (a) supplied to a handicapped person who usually uses a wheelchair, and (b) a qualifying motor vehicle – held in both cases both conditions were fulfilled and the supplies fell to be zero-rated – appeal allowed

Croall Bryson & Company Ltd v Revenue & Customs [2011] UKFTT 494 – Zero Rating – Whether motor vehicle “substantially and permanently adapted for a handicapped person who usually uses a wheelchair” – whether for domestic and personal use to enable a handicapped person to enter and drive in a motor vehicle

The British Disabled Flying Association v Revenue & Customs [2011] UKFTT 743 – whether aircraft for use of disabled persons zero rated

Subdivision 38Q – International mail

38.540 International mail

Subdivision 38R – Telecommunication supplies made under arrangements for global roaming in Australia

38.570 Telecommunication supplies made under arrangements for global roaming in Australia

Subdivision 38S – Eligible emissions units

38.590 Eligible emissions units

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