As soon as the IT rules apply, the responsibility for GST liability shifts from the supplier to the IT operator. The rules apply to the supply of intangible supplies (e.g. digital content, games, software, advice, etc.) directly to Australian consumers. Where the sale of digital services or digital products to Australian consumers takes place through an electronic distribution platform (EDP), the IT operator is generally liable for the GST payable for those sales. To find out if the IT rules are applicable, you need to answer three questions: If the provider is already based in Australia, the „normal“ GST rules apply since the ATO of 1. July 2018 will apply all available enforcement policies to ensure compliance with the new regulations, we strongly recommend that suppliers, marketplaces and re-deliverers take the following steps as soon as possible: To accept the restriction of IT policy enforcement, the IT operator must: In order to simplify compliance and management, computer regulations attempt to transfer responsibility for GST from the individual supplier to the computer being moved. Be sure to read this with non-resident businesses and the GST and GST on imported services, digital products and substandard imported goods in Australia to find out what rules apply in general. If a delivery is excluded from IT regulations, the dealer (and not the IT operator) is liable for GST. But the collection of this GST would be difficult if there were no electronic distribution platforms.
Short computing. The new IT regulation is shifting the hard work of small merchants who use IT to IT itself. This ruling explains how the GST will apply to computer deliveries and the specific rules on supplies subject to the new EDP-GST rules. 1 – Is delivery made via a computer? 2 – Is the tender subject to computerised rules? 3 – If so, are there no exceptions? This judgment discusses the GST payable for the supply of low-value goods, how to account for changes in the GST treatment of these supplies, and how the new Legislation interacts with other Australia-related supply regulations. (1) Low-value goods – episode 194 (2) Incoming intangible supplies – Episode 197 (3) Agreement between the computer operator and the trader to extend the application of computer rules There are three categories of supplies subject to computer rules. If sales are made through multiple EDVs, only one IT operator is responsible for the GST. IT operators can agree among themselves by means of a written agreement which operator is responsible for the GST on delivery. Other standard rules are also explained in LCR 2018/2. If offshore supply is facilitated by IT via electronic communication, IT regulations apply. However, the dealer and the computer operator may agree in writing to restrict the scope of the it rules. There are two new rules regarding the GST.
Rule No. 1 refers to low-value imported goods. Rule #2 is for digital services and products, the so-called „Netflix tax.“ These two rules broaden our tax base for the GST. A registered IT operator may enter into a written agreement with a trader to treat all digital services and products manufactured via the platform as subject to IT rules, whether or not the delivery is an intangible delivery to the consumer. The Bill adopts the definitions and concepts used in the Australian GST Act, and in particular the concept of electronic distribution platforms (EDPs). The new regulation stipulates that onshore and offshore EDPs have a greater obligation with regard to deliveries transiting through the platform. Platforms responding to these new regulations must consider not only the tax aspects, but also the non-tax aspects of protecting the privacy of these returns. A delivery of anything other than goods or goods to an Australian consumer is an incoming delivery of intangible consumer, unless the item is wholly manufactured in Australia or the delivery is made entirely by a company in Australia. If this is the case, the „normal“ GST rules apply. (1) Agree in writing with the dealer to restrict the IT rules (2) Not to approve the burden on the recipient (3) Not to approve the delivery of the delivery (4) Not to specify the conditions (5) Identify the dealer as a supplier We understand that many foreign jurisdictions (for example, New Zealand) will pay attention to Australia`s experience with these measures when considering introducing similar GST rules. Procurement is facilitated by electronic communication, but does not necessarily have to be delivered through the platform itself. If the foreign trader/supplier of digital services or products does not give its operator a business address in Australia, the IT operator may assume that this is an incoming intangible consumer offer.
A document relating to the delivery delivered to the recipient identifies the delivery and the merchant as the supplier of that delivery Electronic distribution platforms – think eBay, Amazon, Shopify and the lot – now play a central role in the collection of GST. A merchant (not EDP) is liable for the GST if all of the following apply: As mentioned above, the Commissioner of Taxation („Commissioner“) can provide the information that must be reported, but has not yet done so. We note that the Commissioner can only request information relating to the identification, collection, collection or reduction of a potential tax liability. The following table, which lists the possible data points that may be required, can be found in the Design Materials Fact Sheet. However, this has left two major gaps in Australia`s GST tax base. Difference #1 was that taxable imports do not cover goods valued at $1,000 or less. And the #2 gap was that taxable imports don`t cover digital services and products. If you can answer yes to all three questions, the IT operator is responsible for collecting the GST for that delivery. IT operators could include such an agreement in their terms in order to streamline their processes. It might be easier to consider all deliveries on the same basis and charge GST for all deliveries to Australian consumers made through the platform. It is not necessary for the IT operator to collect or receive payments or to be involved in each step of the payment authorization process. Taxpayers must register for the GST online, by phone or through their registered agent.
In some cases, the taxpayer may have the right to register with the simplified GST registration option. They must register within 21 days of reaching their GST income threshold. In general, taxpayers must report and pay GST quarterly. The ATO has not yet confirmed the frequency of reporting, but it is expected that there will be two reporting periods per year. Information that helps you when you operate an electronic distribution platform (EDP). Amrit MacIntyre is a partner in Baker McKenzie`s Sydney office, where he focuses on tax planning and consulting. He is one of Australia`s leading tax lawyers and a member of the Australian Taxation Office`s Public Decisions Panel and Chair of the Liaison Committee of the Office of State Revenue/Taxation Institute of Australia. Amrit is recognized as a leading practitioner in Asia Pacific Legal 500, Chambers Asia Pacific, International Tax Review`s World Tax, International Tax Review`s Indirect Tax Leaders Guide, International Tax Review`s Tax Controversy Leaders Guide, PLC Which Lawyer?, Tax Directors Handbook, Who`s Who Legal Corporate Tax and The Australian Financial Review`s Best Lawyers in Australia. The operator of the COMPUTER authorizes the fee to the recipient if it informs the customer of the payment obligation or otherwise influences if or when the customer pays for delivery. If you operate a computer, you are usually responsible for GST in a sale made by a merchant through your platform if: The merchant and the computer operator have agreed in writing that the merchant is the entity responsible for paying GST for delivery. The sharing economy reporting system was one of the recommendations proposed by the Underground Economy Working Group in 2017.
This project follows the first public consultation process in 2019 – the proposed regulation aims to ensure that sellers in the sharing economy comply with their tax obligations and that these sellers do not have an unfair advantage over similar activities in other sectors of the economy with better compliance with tax regulations. In addition, platform operators with an Australian user base are almost always subject to the Privacy Act 1988 (Cth) („Australian Privacy Act“), which requires (among other things) transparency through privacy policies and collection notices regarding: laws that permit or require the collection of personal information; the purposes of the disclosure of personal data; and the likely recipients of the disclosed personal data.