Subject: GST and ex-gratia payments made in lieu of local government rates
19 August 2015
Question 1
Are ex-gratia payments made by Entity A to you in lieu of local government rates treated as consideration, for supplies made by you to Entity A under section 9-5 of the GST Act?
Answer
No. The ex-gratia payments made by Entity A to you in lieu of local government rates are not consideration for supplies made by you to Entity A. Therefore, you are not making taxable supplies to Entity A under section 9-5 of the GST Act for which the ex-gratia payments are consideration.
Question 2
Are the ex-gratia payments made by Entity A to you in lieu of local government rates considered Australian taxes, fees or charges under Division 81 of the GST Act for the purposes of that Division prior to 1 July 2011 or after 1 July 2011?
Answer
No. The ex-gratia payments made by Entity A to you in lieu of local government rates are not considered Australian taxes, fees or charges under Division 81 of the GST Act from the implementation of the GST.