Many NDIS supports are GST-free, but not every service delivered to an NDIS participant is automatically GST-free.
That distinction matters.
If you run an NDIS business and treat every payment as GST-free simply because it comes from an NDIS participant or plan manager, you could end up with the wrong BAS treatment.
The GST rules depend on what you supply, who you supply it to, what is in the participant’s plan, your written agreement and whether the particular support is covered by the relevant GST-free NDIS determination.
This guide explains how the rules work for the 2026–27 financial year, including the four requirements you need to check before treating an NDIS supply as GST-free.
How Does the GST-Free NDIS Rule Work?
The NDIS GST-free rules sit in section 38-38 of the A New Tax System (Goods and Services Tax) Act 1999.
The important point is that GST-free treatment applies to a qualifying supply, not automatically to an NDIS provider or organisation.
In other words:
Being an NDIS provider does not make all of your income GST-free.
A provider can make both GST-free and taxable supplies.
For example, an NDIS provider might supply an eligible support under a participant’s plan and also provide a separate service that falls outside the GST-free NDIS rules.
Each supply needs to be considered on its own facts.
The ATO confirms that NDIS supplies are GST-free only where the requirements of section 38-38 are satisfied.
The Four Conditions for a GST-Free NDIS Supply
For an NDIS supply to qualify for GST-free treatment under section 38-38, four requirements must be satisfied.
1. The participant must have an NDIS plan in effect
The supply must be made to an NDIS participant whose plan is in effect when the supply is made.
If the participant’s NDIS plan is no longer in effect, you cannot simply continue treating the supply as GST-free under section 38-38.
That does not necessarily mean every alternative supply is automatically taxable — you need to consider whether another GST-free provision applies — but the NDIS-specific exemption will not be satisfied.
2. The supply must be a reasonable and necessary support in the participant’s plan
The service you provide must be one or more of the reasonable and necessary supports specified in the participant’s plan.
This is where providers can get into trouble by relying only on the name of their service.
A service may sound like an NDIS support, but that does not automatically mean the particular supply qualifies.
You need to consider what the participant’s plan actually specifies and whether the service being supplied corresponds with those supports.
3. There must be a qualifying written agreement
The supply must be made under a written agreement between the supplier and the participant or another relevant person.
The legislation requires the agreement to:
- identify the participant; and
- state that the supply is for one or more reasonable and necessary supports specified in the participant’s NDIS plan.
The agreement does not necessarily have to be a single standalone document. The important issue is whether the required information is documented.
For an NDIS provider, having clear agreements, invoices and supporting records is therefore more than an administrative exercise — it helps establish the basis for your GST treatment.
4. The support must be covered by the GST-free NDIS determination
This is the condition that is often missed.
A support appearing in the NDIS Support Catalogue does not, by itself, make the supply GST-free.
The particular supply must be a kind covered by the applicable GST-free NDIS determination.
The current A New Tax System (GST-free Supply—National Disability Insurance Scheme Supports) Determination 2021 is in force and, following the 2025 amendment, applies to relevant supplies made up to 30 June 2027.
So the correct approach is not:
“It is in the NDIS catalogue, therefore it is GST-free.”
Instead, work through the statutory requirements and the relevant determination.
Does the NDIS Support Catalogue Determine GST?
Not by itself.
The 2026–27 NDIS Support Catalogue is an important reference for providers because it identifies available supports, support categories and pricing information.
But GST treatment comes from the GST legislation and the relevant GST-free determination.
The ATO gives examples showing why this distinction matters. A particular service can be included in a participant’s NDIS plan without necessarily satisfying the GST-free NDIS rules.
That means providers should use the Support Catalogue as part of their review, not as the sole test for whether GST applies.
Do Registered NDIS Providers Automatically Charge No GST?
No.
Registration status is not one of the four conditions in section 38-38.
An unregistered provider may still make a GST-free NDIS supply where all of the legal requirements are met.
Likewise, being a registered NDIS provider does not make every service you provide GST-free.
This is particularly important for providers who have multiple revenue streams.
For example, your business might receive:
- GST-free NDIS support payments;
- taxable private services;
- consulting income;
- training income; or
- sales of goods.
You need to classify those supplies correctly rather than applying one GST treatment to the entire business.
What About Self-Managed and Plan-Managed Participants?
The GST analysis does not simply turn on whether the participant is self-managed, plan-managed or NDIA-managed.
The key question is whether the specific supply satisfies section 38-38 and the applicable determination.
This is why an unregistered provider can potentially make GST-free supplies to eligible participants.
However, where you are dealing with different funding arrangements or services outside the ordinary NDIS support structure, it becomes even more important to document the basis for your GST treatment.
What Does GST-Free Mean for an NDIS Business?
GST-free does not mean the business is exempt from GST altogether.
If you are registered for GST and make GST-free supplies, you generally:
- do not charge GST to the participant or plan manager on those qualifying supplies;
- report the relevant income through your BAS; and
- may still claim GST credits for eligible business purchases used to make your GST-free supplies.
That is one of the important differences between GST-free and input-taxed supplies.
For example, if your NDIS practice purchases software, office equipment or professional services and the business is entitled to an input tax credit, the fact that your qualifying NDIS income is GST-free does not automatically prevent you from claiming that GST credit.
If your business also makes taxable supplies, you may need to consider how your acquisitions relate to those supplies when calculating your GST credits.
Do NDIS Providers Charge GST on Every Invoice?
No.
Where a supply qualifies as GST-free under section 38-38, GST is not charged.
Where a separate supply is taxable and no other GST-free provision applies, GST may be payable at the standard 10% rate.
This is why your accounting system should be able to distinguish between GST-free and taxable income rather than simply recording all NDIS-related revenue under one tax code.
KSH TAX’s BAS lodgement service can help providers keep GST reporting, BAS preparation and supporting records organised.
What Should Your NDIS Service Agreement Say?
Your service agreement should make it easy to understand what is being supplied and why the GST treatment applies.
At a minimum, make sure your documentation clearly identifies:
- the participant;
- the supports being provided;
- the connection with the participant’s NDIS plan;
- the agreed services and billing arrangements; and
- the GST treatment applied to the supply.
You do not necessarily need to reproduce the entire NDIS plan in your agreement.
The important issue is that your records collectively support the requirements of section 38-38.
A generic agreement that says “NDIS services” without identifying what is actually being supplied is much less useful than documentation that clearly establishes the relationship between the participant, the agreed supports and the services delivered.
What Happens If You Get GST Wrong?
There are two common problems.
You charge GST on a GST-free supply
You may have charged the participant or plan manager more than they should have paid.
Depending on the circumstances, you may need to correct the transaction and account for the overcharged amount appropriately.
You treat a taxable supply as GST-free
This can leave your business with an unpaid GST liability.
You may then have to correct previous BAS reporting and potentially pay the GST shortfall, interest and administrative penalties depending on the circumstances.
This is why a GST review is worthwhile when you introduce new services, change your business model or notice that some invoices are being treated differently from others.
Can You Claim GST Credits If Your NDIS Income Is GST-Free?
Generally, yes, provided you are GST-registered and the normal requirements for claiming an input tax credit are satisfied.
For example, your business may purchase:
- accounting software;
- office equipment;
- business insurance;
- professional services;
- technology subscriptions; or
- other business inputs.
If those purchases are creditable acquisitions and are used in making your GST-free supplies, the GST-free nature of your NDIS income does not, by itself, prevent you from claiming the relevant GST credits.
Where your business makes a mixture of GST-free and taxable supplies, you need to ensure your bookkeeping and BAS treatment correctly reflect that mix.
How Often Should an NDIS Provider Review Its GST Treatment?
Don’t wait until the ATO asks questions.
Review your GST treatment when:
- you add a new support or service;
- the way a participant is funded changes;
- your service agreement changes;
- the NDIS Support Catalogue or relevant rules are updated;
- you start accepting private-pay clients; or
- you discover that different staff are applying different GST codes.
A yearly review is also sensible, particularly because NDIS pricing documents and support information can change between financial years.
The Simple GST Checklist for NDIS Providers
Before treating an NDIS supply as GST-free, ask:
- Is the participant’s NDIS plan in effect?
- Is the service a reasonable and necessary support specified in the plan?
- Do I have the required written agreement?
- Is the type of support covered by the current GST-free NDIS determination?
If the answer to all four is yes, the supply may qualify for GST-free treatment under section 38-38.
If one answer is no, don’t automatically assume the supply is taxable either. Check whether another GST-free provision applies and, where necessary, get professional advice.
Keep Your NDIS GST Treatment Clean
For NDIS providers, GST mistakes often start with a simple assumption:
“It’s NDIS income, so it must be GST-free.”
That is not the rule.
The better approach is to classify each supply against the actual GST requirements, keep the supporting documentation, and make sure your accounting system reflects the difference between GST-free and taxable income.
KSH TAX works with Australian businesses on GST, BAS, bookkeeping and tax compliance, helping owners understand not just what to report, but why.
Our BAS lodgement service is designed to keep GST reporting accurate and on time, while our Bookkeeping services can help keep your transaction coding and records in order throughout the year.
Not sure whether your NDIS income should be GST-free? Contact KSH TAX or call 08 6285 8110 for a review of your current GST treatment.
