A New Tax System (Goods and Services Tax) Act 1999

Chapter 2 - The basic rules

Part 2-2 - Supplies and acquisitions

Division 9 - Taxable supplies

Subdivision 9-A - What are taxable supplies?

9-26 Supplies by non-residents that are not connected with the indirect tax zone

(1)
A supply is not connected with the indirect tax zone if:

(a) the supplier is a *non-resident; and

(b) the supplier does not make the supply through an *enterprise that the supplier * carries on in the indirect tax zone ; and

(c) the supply is covered by an item in this table:

Offshore supplies that are not connected with the indirect tax zone
Item	Topic	These supplies are *not* connected with the indirect tax zone …
1	Inbound intangible supply	a supply of anything other than goods or *real property if:
		(a)	the thing is done in the indirect tax zone; and
		(b)	the recipient is an Australian-based business recipient of the supply.
2	Intangible supply between non-residents	a supply of anything other than goods or *real property if:
		(a)	the thing is done in the indirect tax zone; and
		(b)	the recipient is a non-resident that acquires the thing supplied solely for the purpose of an enterprise that the recipient carries on outside the indirect tax zone.
3	Supply between non-residents of leased goods	a supply by way of transfer of ownership of leased goods if:
		(a)	the recipient is a non-resident that does not acquire the thing supplied solely or partly for the purpose of an enterprise that the recipient carries on in the indirect tax zone; and
		(b)	the lessee:
			(i)	made a *taxable importation of the goods before the supply was made; and
			(ii)	continues to lease the goods on substantially similar terms and conditions after the supply is made.
4	Supply by way of continued lease of goods from item 3	a supply made by way of lease if:
		(a)	the *recipient is the lessee referred to in paragraph (b) of item 3 of this table; and
		(b)	the lease is the lease referred to in subparagraph (ii) of that paragraph.

Note:

This subsection does not apply to supplies made by a non-resident through a resident agent if they have agreed it is not to apply: see section 57-7 .

(2)
An entity is an Australian-based business recipient of a supply made to the entity if:

(a) the entity is *registered; and

(b) an *enterprise of the entity is *carried on in the indirect tax zone; and

(c) the entity ' s acquisition of the thing supplied is not solely of a private or domestic nature.

Note:

If a supply is not connected with the indirect tax zone, the Australian-based business recipient may be subject to a reverse charge: see Subdivision 84-A .

(3)
This section applies despite sections 9-25 (which is about when supplies are connected with the indirect tax zone) and 85-5 (which is about telecommunication supplies).

View history note

History

S 9-26 inserted by No 52 of 2016, s 3 and Sch 2 item 3, applicable in relation to working out net amounts for tax periods starting on or after 1 October 2016. No 54 of 2016, s 3 and Sch 2 items 26 and 27 contain the following saving provisions:

26 Saving - previous interpretation preserved
The amendments of Division 72 of the A New Tax System (Goods and Services Tax) Act 1999 do not affect by implication the interpretation of that Act before the amendments. 27 Existing agreements: no opportunity to review
(1)
The amendments do not apply in relation to a supply if:

(a) a written agreement specifically identifies the supply and identifies the consideration in money, or a way of working out the consideration in money, for the supply; and

(b) the agreement was made before the commencement of this Schedule; and

(c) the supplier is registered or required to be registered.

(2)
Subitem (1) does not apply to a supply to the extent (if any) that it is made on or after the earlier of the following:

(a) if a review opportunity (within the meaning of section 13 of the A New Tax System (Goods and Services Tax Transition) Act 1999 ) arises on or after the commencement of this Schedule - when that opportunity arises;

(b) if the supplier and the recipient of the supply agree in writing that the amendments made by this Schedule should apply from a time - that time.

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