13.06.2017

Don't Get Caught On The Hop: Changes To Australian GST For Crossborder Supplies of Intangibles

Changes to Australian GST for crossborder supplies commencing 1 July 2017: Are you ready?

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As previously reported, from 1 July 2017, ‘inbound intangible supplies’ will attract Australian GST where made by non-resident suppliers to Australian consumers. In addition, under proposals still before Parliament, low-value goods (AUD 1,000 and under) supplied by overseas retailers to Australian consumers would also become taxable supplies beginning 1 July 2017. 

From next month, 'supplies of things other than goods or real property made to an Australian consumer’ will be connected with Australia and subject to GST. The Australian provisions are broader than some other jurisdictions and essentially anything other than goods or real property are caught, and if an entity’s GST turnover exceeds the registration turnover threshold of AUD 75,000, it would be required to register for GST in Australia. Non-resident suppliers will be able to access a limited and simplified GST registration, although they can also register under the full registration procedure.

Where supplies of inbound intangibles are made through an Electronic Distribution Platform (EDP), the GST liability on these supplies would shift to the operator of the EDP (i.e. generally, online marketplaces that act as intermediaries). The Australian Taxation Office (ATO) has released a draft Law Companion Guideline (LCG 2017/D4) dealing with the EDP provisions.

Sellers of digital content and service providers into Australia who have not already done so, should consider the impact of these rules on their businesses and current arrangements to be ready for the changes when they take effect on 1 July 2017.

For further help and assistance, please contact our VAT Compliance team for free advice: vat@taxbackinternational.com 

Should you wish to discuss this or if you would like further information, please contact us by:

  +353 56 778 34 00      

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