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This is a Bill, not an Act. For current law, see the Acts databases.
2002-2003
The Parliament of
the
Commonwealth of
Australia
HOUSE OF
REPRESENTATIVES
Presented and read a first
time
Taxation Laws Amendment (A
Simpler Business Activity Statement) Bill
2003
No. , 2003
(Mr
Latham)
A Bill for an Act to provide small
businesses with a simpler method of calculating Goods and Services Tax
payments
Contents
A Bill for an Act to provide small businesses with a
simpler method of calculating Goods and Services Tax
payments
The Parliament of Australia enacts:
This Act may be cited as the Taxation Laws Amendment (A Simpler
Business Activity Statement) Act 2003.
This Act commences on 1 July 2004.
Each Act that is specified in the Schedule to this Act is amended as set
out in the applicable items in the Schedule.
A New Tax System (Goods and Services Tax) Act
1999
1 Section 17-99 (after table item
12A)
Insert:
12AA Simpler method of calculating net amounts Division 124
2 After Division 123
Insert:
Table of Subdivisions
124-A Commissioner to create a simplified method of calculating net
amounts using a ratio-to-turnover approach
124-B Choosing the simplified method of calculating net amounts using a
ratio-to-turnover approach
124-C No variation of net amounts
124-D Record keeping requirements
124-1 What this Division is
about
The Commissioner can create a simplified method of calculating net amounts,
using a ratio-to-turnover approach, with a view to reducing the costs to small
business of complying with the requirements of the GST.
If you elect to calculate GST using this method, your quarterly or monthly
net amount is calculated by multiplying your turnover by a ratio determined by
the Commissioner and printed on your BAS.
Subdivision 124-A—Commissioner
to create a simplified method of calculating net amounts using a
ratio-to-turnover approach
(1) The Commissioner may determine in writing an arrangement (to be known
as the ratio method) whereby your
*quarterly or monthly turnover is multiplied by
a *GST ratio notified to you by the
Commissioner. The Commissioner’s determination shall:
(a) specify the kind of entities to whom the method is available;
(b) provide a method of working out the
*net amount for entities to whom the method
applies;
(c) allow for alterations to be made to an entities
*net amount to take account of extraordinary
expenses arising during a payment period;
(d) provide that, if for a particular *tax
period, the *net amount worked out using the
method is greater than zero, that amount is the full and final amount payable to
the Commissioner for that *tax period;
and
(e) provide that, if for a particular *tax
period, the *net amount worked out using the
method is less than zero, that amount (expressed as a positive amount) is the
full and final amount payable by the Commissioner, on behalf of the
Commonwealth, to you for that *tax
period.
(2) The kind of entities specified under paragraph 124-5(1)(a) must have an
*annual turnover not in excess of $2 million or
such higher amount as the regulations specify.
(3) In making a determination under subsection 124-5(1) the Commissioner
must consult with business, professional, taxpayer and other relevant bodies and
organisations.
(4) This section has effect despite section 17-5 (which is about net
amounts).
Your quarterly or monthly turnover is an amount equal to that
portion of your *current annual turnover
attributable to the relevant *tax
period.
Your Goods and Services Tax Ratio (to be known as your GST
ratio) for a tax period is a percentage that is:
(a) worked out by the Commissioner, having regard to:
(i) the trading circumstances that exist for businesses operating in the
same industry or industry sector (to be known as an industry-based GST ratio);
or
(ii) your trading history and circumstances (to be known as your personal
GST ratio); and
(b) notified by the Commissioner to you before the day on which your GST
payment is due.
Note: Determining your GST ratio is a reviewable GST
decision (see Division 7 of Part VI of the Taxation Administration Act
1953).
Subdivision 124-B—Choosing the ratio
method
(1) You may, by notifying the Commissioner in the
*approved form:
(a) choose to use the *ratio method if
you are an entity to whom the method is available; and
(b) revoke your choice to apply the method.
(2) However, you:
(a) cannot revoke the choice within 12 months after the day on which you
made the choice; and
(b) cannot make a further choice within 12 months after the day on which
you revoked a previous choice; and
(c) cannot choose to use the *ratio method
in addition to any other method of calculation and payment.
(3) Your choice to use the *ratio method
has effect from the start of the *tax period
specified in your notice.
(4) Your choice to use a *ratio method
ceases to have effect:
(a) if you cease to be an entity to whom the method is available—from
the start of the tax period occurring after the day on which you cease to be
such an entity; or
(b) if you revoke your choice to use the method—from the start of the
tax period specified in your notice of revocation.
(5) The Commissioner may disallow your choice, even though you are an
entity to whom the *ratio method is available,
if the Commissioner is satisfied that you have a history of failing to comply
with your obligations under a *taxation
law.
Note: Disallowing your choice is a reviewable GST decision
(see Division 7 of Part VI of the Taxation Administration Act
1953).
(6) Notwithstanding subsection 124-20(2), the Commissioner
may:
(a) allow you to revoke your choice within 12 months after the day on which
you made the choice; and
(b) allow you to make a further choice within 12 months after the day on
which you revoked a previous choice.
Note: A decision by the Commissioner not to allow you to
revoke your choice within 12 months after the day on which you made the choice,
or not to allow you to make a further choice within 12 months after the day on
which you revoked a previous choice, is a reviewable GST decision (see Division
7 of Part IV of the Taxation Administration Act 1953).
Subdivision 124-C—No variation of net
amounts
(1) If you have chosen to use the *ratio
method, the Commissioner may not vary the *net
amount arising from the application of the method.
(2) Notwithstanding subsection 124-25(1), the Commissioner may vary the net
amount arising from the application of the
*ratio method if, at or after the time you
notify the Commissioner of your choice to use the method:
(a) you have an *annual turnover in excess
of $2 million or such higher amount as the regulations specify;
(b) you make a statement to the Commissioner that is false or misleading in
a material particular, because of information stated or omitted;
(c) you act in a manner contrary to the Commissioner’s determination
under 124-5(1); or
(d) you otherwise fail to comply with your obligations under a
*taxation law.
Subdivision 124-D—Record keeping
requirements
(1) If you have chosen to use the *ratio
method, you must keep records that record and explain your
*quarterly and monthly turnover, and such other
matters specified in the regulations, for at least 5 years after the completion
of the transactions or acts to which they relate.
(2) This section has effect despite section 70 of the Taxation
Administration Act 1953.
3 Section 188-5 (after table item
4)
Insert:
|
5 |
Ratio method turnover threshold |
whether you can choose the ratio method of calculating net amounts (see
Division 124) |
4 Section 195-1
Insert:
GST ratio has the meaning given by section 124-15.
5 Section 195-1
Insert:
ratio method means an arrangement for the simplified method
of calculating net amounts in respect of which a determination under section
124-5 is in place.
6 Section 195-1
Insert:
quarterly or monthly turnover has the meaning given by
section 124-10.
A New Tax System (Goods and Services Tax
Administration) Act 1999
7 Subsection 62(2) (after table item
37)
Insert:
37A determining your GST ratio subsection 124-15(1)
8 Subsection 62(2) (after table item
37A)
Insert:
37B disallowing a choice to use the subsection 124-20(5)
ratio method of
calculating net
amounts
9 Subsection 62(2) (after table item
37B)
Insert:
37C disallowing changes to your choice subsection 124-20(6)
to use the
ratio method of calculating
net amounts, within 12 months of
your original
choice