Importantly, the Australian Taxation Office (ATO) has confirmed that there is no substantive change to its interpretation of the underlying goods and services tax (GST) law, commonly known as the ‘Netflix Tax’.

Instead, the draft ruling clarifies and expands upon the existing guidance by addressing both parts of the Australian consumer test, incorporating the safeguard approach, and expanded compliance guidance.

Residency and consumer elements – greater focus on consumer limb

The definition of an Australian consumer remains unchanged and continues to require both the residency element and the consumer element to be satisfied. That is that the recipient is an Australian resident for income tax purposes and is either not registered for GST, or if registered, does not acquire the supply for the purpose of an enterprise.

However, GSTR 2026/D1 significantly expands on the consumer element, which was only lightly addressed in GSTR 2017/1. The earlier ruling focused more heavily on residency indicators, such as billing address and IP data, with comparatively limited practical guidance on GST registration and the purpose of acquisition.

The draft confirms that where a recipient provides an Australian business number (ABN) and represents to the supplier that they are registered for GST, a supplier may rely on that representation not only to establish GST registration, but also to conclude that the acquisition is made for enterprise purposes.

The safeguard approach under section 84-100

A central feature of the draft is the clearer articulation of the ‘safeguard approach’ under section 84-100. While not new, it is now framed as a more structured methodology for forming a reasonable belief about whether a recipient is not an Australian consumer.

This approach provides a pathway for suppliers to treat a supply as ‘not made to an Australian consumer’, provided they:

• collect specified information (e.g. ABN, declarations that the recipient is registered for GST)
• maintain consistent records
• apply defined system controls.

The key being that the supplier has undertaken all reasonable steps to form its conclusion.

Where the safeguard approach is followed, a greater level of certainty and protection is provided to the supplier, particularly for automated or high-volume environments where individual review is impractical.

Attribution and compliance approaches

The draft expands guidance on timing and attribution, making it clear that a recipient’s status is generally determined at the time of invoice or receipt of consideration. This is particularly important for subscription and other ongoing arrangements, where a customer’s circumstances may change over time or additional information becomes available after the initial transaction.

The draft also introduces more detailed compliance approaches, particularly in relation to the consumer element safeguard. For initial supplies to a recipient, greater leeway is provided where an ABN check indicates that the recipient is not registered, but the recipient has provided evidence of registration to the supplier.

For ongoing supplies, more structured processes are expected, including:

• ongoing monitoring (e.g. regular ABN Lookup checks at least every 6 months)
• annual GST registration verification.

The draft reiterates that suppliers may rely on comparable jurisdiction approaches (EU, UK, NZ, and Norway) for determining residency.

Where suppliers operate outside the safeguard, reliance is generally limited to information already held within their systems to determine only if the recipient acquires the supply for the purpose of its enterprise.

How SW can help

GSTR 2026/D1 does not change the legal framework, but it clearly raises expectations around how businesses implement and provide evidence of compliance. In particular, the increased focus on GST registration, the consumer element, and ongoing verification means more structured processes will be required than under GSTR 2017/1.

Businesses should review their onboarding procedures, ABN validation processes, and system controls to ensure they align with the draft and can support a defensible position if reviewed by the ATO. Early alignment with the ATO’s compliance approaches will help reduce risk and improve consistency across cross-border transactions.

The ATO has invited public comments on the draft ruling, with submissions due by 24 July 2026.

If you would like to understand how these changes may impact your cross-border GST obligations, please contact your SW advisor or speak with our GST specialists.

Contributors

Dylan Kelly | Senior Consultant, Tax

The post Know your consumer: ATO’s new draft ruling for GST cross-border supplies appeared first on SW Accountants & Advisors.

In the 2021 Federal Budget, the former Government announced that it was providing $1.9m to build an online system to enhance the transparency of income tax exemptions claimed by Not-for-profits (NFPs).  From 1 July 2023, NFPs’ seeking to maintain their income tax exempt status will be required to lodge an online Annual Self-Review Form. This is part of the ATO’s recently revised guidance on the games and sports income tax exemption for not-for-profit clubs under Tax Ruling 2022/2.

SW has liaised with the ATO and can confirm that this announcement is still expected to be implemented.

Annual Self-Review Form

The ATO has confirmed the following details:

Lodgement timing

The first return will need to be lodged for the 2023–24 income year, with those clubs with a 30 June year end being the first required to lodge. This means the earliest anyone will be required to submit a return is 1 July 2024.

Who is required to lodge?

Only self-assessing income tax exempt entities (e.g. sporting clubs) with an active ABN are required to lodge a return under the new self-assessing reporting arrangements. For those clubs applying the principles of mutuality as to their income tax obligations, there is no change to existing income tax return lodgement processes.

Entities that do not hold an active ABN, will not be required to lodge a return or satisfy ongoing ABN registration requirements.

Are there additional obligations?

The two additional obligations for ongoing ABN registration are:

• the obligation to comply with income tax return lodgement requirements, and
• the obligation to update the accuracy of details on the Australian Business Register (ABR), annually.

It is intended that the return for self-assessing income tax exempt entities will collect the information required to satisfy the new ABN requirements, without the need for these entities to provide further information.

What information does the Annual Self-Review Form need to include?

The return is not an income tax return but rather a form containing the information that a club would ordinarily use for self-assessing eligibility for income tax exemption on a yearly basis.

The form needs to satisfy three elements:

1. Entitlement to income tax exemption
2. Basis for entitlement (category), and
3. Whether all requirements are being met.

How to prepare for the new reporting regime

There are 3 things your club can do to prepare for the new reporting regime:

1. Update your contact details with the ATO. It’s an ABN registration requirement to keep your contact details current and it also means you’ll receive important information about your tax and super obligations.
2. Use the ATO worksheets to review your eligibility for an income tax exemption.
3. Stay informed.

How can SW help?

If you would like to discuss how to best prepare for the new Annual Self-Review reporting regime and/or broader eligibility for income tax exemptions, please contact us.

Contributors

Alice Mulvogue

The post Clubs – Update on new self-review requirement for income tax exemption appeared first on SW Accountants & Advisors.