Under the GST Act, the supply of gold bullion is input taxed. In layman terms this essentially means that the supply and purchase are GST free. BUT, the supply of scrap gold attracts GST. So it is critical that an entity trading in gold understands the distinction between gold bullion and scrap gold.
What then is gold for the purposes of the GST Act? Gold is not defined. Rather, the gold must be a “precious metal” within the GST Act.
The GST Act defines “precious metal” as meaning
Thus, according to the GST Act, the gold must be in investment form of at least 99.5% fineness to be a precious metal.
“Investment form” is not defined within the tax legislation. The Commissioner considers that for gold, silver of investment to be in an “investment form” for the purposes of the GST Act, it must be in a form that
In light of evidence that suggests there are a number of bogus gold and/or scrap traders, the ATO is taking an aggressive stance where it suspects an entity of rogue trading and is garnisheeing its funds.
Message: If you are being audited for gold trading and you believe you have not done anything wrong, contact us now for legal assistance.