Hi OZ bargainers,
Can anyone tell me if GST will be imposed on Kickstarter projects that I have backed that supposedly to be delivered after July? Kickstarter keeps on claiming that they are not a store. But will it be the case? Any experts in here on GST in relation to Kickstarter?
They already kinda doing it, GST slapped on top of duty.
Wonder if you can claim back the GST if they don't fulfil the project?
You'd get a refund of what you paid so you'd think you would get it back
Kickstarter does refunds?
Doesn't it? If it doesn't, what happens to the money? The project creators don't get it.
The project creators don't get it
Yes they do. How are they going to get the product made with no money, that's the whole point of Kickstarter.
The creators get the cash pretty soon (1-2 weeks?) after the campaign closes, less Kickstarter (and Amazon's) cut of 10% or whatever.
That's why they did the "We're not a store" thing, if you've a problem take it up with the creator.
You missed the context
No.
Kickstarter will not collect GST.
The creator gets the money, they're responsible for GST.
If they spend it all and don't deliver, then you get nothing. Where is the money going to come from? There's been thousands of failed projects with 'customers' yelling for their money back. Even lawsuits. In theory the ATO can pursue them for GST, they're not going to give it to you though.
It's like asking for a refund of GST after you get scammed on eBay.
(and yes, SCHMUCK was just being silly. I hope.)
@D C:
Kickstarter will not collect GST.
The creator gets the money, they're responsible for GST.
This is the same as Amazon third party or eBay though. It would make sense for the actual sellers to collect it and do the admin but that would never work.
I thought the discussion was if the project doesn't get enough money to go ahead - everyone gets their money returned. If the creators get enough money and then blow it, it is just the same as if you buy something dodgy and don't get your money's worth. On kickstarter that's a risk you take. I can't see you getting your GST back, same as if you bought a dodgy item from a retailer and failed in getting them to repair or replace, you wouldn't just get your GST back but not the rest of the amount. I guess I misunderstood the original comment?
This is the same as Amazon third party or eBay though.
Not really. Kickstarter isn't a marketplace, it's a funding platform. You're not buying a product, you are funding it's development. Asking them to collect GST is like asking PayPal to do the same. At least that'll be their argument and they'll push it onto the project creators.
if the project doesn't get enough money to go ahead - everyone gets their money returned.
You only pledge money, once the project target is reached then the payment happens. If the target isn't reached then nothing happens - no refund because you never paid anything. (Indigogo is a little different.)
Fulfilment is getting the product you 'invested' in. You've no recourse if the project fails. You placed your bet and the horse fell over.
Kickstarter TOS do say if the project fails the creators should refund the money, but then go on to say they're not going to get involved in any disputes. "Not our problem, dudes".
In one famous example (Peachy printer) one of the founders took a few hundred thousand dollars and purchased a house with it. The money was never seen again (except in house form). Read up on that one, it's astounding.
@D C:I didn't realise they didn't collect the money until enough had been pledged - I'd only used indigogo.
Will be interesting to see what happens come July
I'd only used indigogo
Indigogo is the scammers crowdfunding platform of choice as they charge your card immediately, and with flexible funding they still get the cash even if they don't meet their target. (And Kickstarter make you build a prototype - no such hassles on Indigogo.)
Information on crowding funding here:
Reward-based model
Under a reward-based model, the promoter provides goods, services or rights in return for payments by funders. The promoter will have a GST liability if a taxable supply is made to the funder.
If the promoter makes a taxable supply, the funder is entitled to an input tax credit if the funder is registered for GST and the acquisition is made for a creditable purpose. Generally, no input tax credit is available if the acquisition relates to the funder making input taxed supplies. The intermediary makes a taxable supply of services to the promoter.
However, for the purposes of the information below, it is assumed that both the promoter and the intermediary carry on an enterprise in Australia and are registered for GST.
Not applicable for this discussion I think
I think the models might still be similar though since the page also states:
From 1 July 2017 supplies made by a non-resident promoter or intermediary may be subject to GST.
If you have already paid no….
GST… Goods and SERVICES Tax…. Kickstarter might not be a store, but its providing a service (for profit too)
but its providing a service (for profit too)
They're a payment platform.
They're not providing you with a product or service, they're collecting money that they then give to someone else who provides the goods or service.
It would be like adding GST to bank transfers. "Well, by allowing you to move money around the bank is providing a service…"
What a nightmare this is turning into.
I guarantee Australia will just be struck off from participating in many of these things like kickstarters or just eliminated from shipping destinations from stores.
it's already happened with base.com, they've blocked australia as a buyer destination. They had a tonne of great cheap stuff too
It won't affect Kickstarter. Kickstarter is not a store, and does not provide a service to anyone other than the project owner. You essentially donate or 'invest' in a project and receive a reward for doing so.
For what it's worth, I had an additional (unanticipated and unauthorised) charge of 20% from Stripe on an Australian produced project that I backed last week (which I also understood would be being shipped from within Australia). I think there's a large debacle with that project which is currently being worked through. I would've thought that Kickstarter itself should be GST-agnostic, leaving that as an issue for the project creator (which I'm assuming is the entity with the GST liability…) to deal with—alternatively, for goods shipped into Australia, I imagine they'd be held by Customs until the consignee had footed the GST charge (under the prevailing rules, which were amended this year to deal with sub-AU$1000 imports).
Just an update on this: apparently the 20% was just a pre-authorisation which disappeared once the project was funded. I'm still yet to see where the items are shipped from though and, therefore, whether there's an attempt for GST to be added at the border.
I'm not sure but the way this Governments going there will be GST on GST soon…