ATO Clarifies GST Exemption for Supplies to Nonresident Entities
The Australian Taxation Office (ATO) has clarified the Goods and Services Tax (GST) exemption for supplies made to nonresident entities. The new ruling, GSTR 2025/1, was issued on July 23, 2025, and provides guidance on the exemption's scope and application.
GSTR 2025/1 explains that supplies other than goods or real property are GST-exempt if made under an agreement directly or indirectly with a nonresident. However, the exemption does not extend to supplies involving options or acquisition rights for Australian real property, or input-taxed supplies within Australia.
For mixed supplies made to both nonresident and resident entities, only the portion supplied to the nonresident qualifies for the exemption. The ruling applies retroactively to supplies made both before and after its issue date, provided the relevant conditions are met.
The ATO's new ruling provides much-needed clarity on GST exemptions for supplies made to nonresident entities. It outlines the conditions under which supplies are exempt and those that are not, helping businesses understand their GST obligations more accurately.