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TDS 22/13: Whether portable units are exempt supplies of accommodation in a Dwelling

In this technical discussion summary a case of taxpayer was discussed to explain residential exempt supply. The Taxpayer rents portable self-contained units to its customers under a hire agreement. The portable units typically serve as an extension to the customer’s existing property. The portable units may be used as residential accommodation or commercial (office) premises. Where the purpose of the hire is not residential, GST is charged on the hire. The legal issue was whether there was an exempt supply of residential accommodation. It was held:

  1. The supply of portable units under the hire agreement consists of multiple separate supplies. These supplies include a series of successive supplies of the hire of the portable units, deemed to occur under s 9(3)(a), and a separate supply of delivery and installation of the portable units.
  2. The series of successive supplies of the portable units are not exempt supplies of “accommodation in a dwelling” under s 14(1)(c). The Taxpayer is therefore liable for GST on the supplies.
  3. In this case, the portable units are hired under a hire agreement that provides for the temporary use of the portable unit in exchange for weekly payments. Therefore, s 9(3)(a) deems the supply of the portable units to be a series of successive supplies. Each time a weekly payment is made (or becomes due), there is another supply. The GSTA determines that these are multiple successive supplies and must be considered separately in determining whether they are exempt supplies. No issue of whether they are a single supply arises as the GSTA treats them as separate supplies.
  4. Application of s 14(1) (C) discussed. Supply of accommodation in a dwelling is important. The Taxpayer is not supplying the right to stay, rather is supplying a physical structure. This physical structure could conceivably be used to supply accommodation, but that is not what is being supplied in this dispute.



*The above article is a high-level explanation of the methods of calculation, and there may be other technicalities/rules that are applicable. The complexity of the calculations can also vary. Please reach out to us if you have specific questions regarding your situation.


Please note that the above does not constitute specific tax advice and only intends to be a general advice. If you require specific advice related to your situation, please reach out to our tax consultant using the ‘contact us’ option.


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