Commonwealth Numbered Acts

TAXATION LAWS AMENDMENT ACT (NO. 8) 2000 NO. 156, 2000 - SCHEDULE 4

A New Tax System (Goods and Services Tax) Act 1999

1 Section 17-99 (table item 15)

2 Section 21-99 (table item 1A)

3 Section 29-39 (table item 13)

4 Section 37-1 (table item 3A)

5 Section 37-1 (table item 33)

6 Division 132 (heading)

Division 132—Supplies of things acquired etc. without full input tax credits
7 At the end of section 132-1

8 Section 132-5 (heading)

132-5 Decreasing adjustments for supplies of things acquired, imported or applied for a purpose that is not fully creditable
9 Paragraph 132-5(1)(c)

(c)

your acquisition, importation or subsequent ^* application of the thing, related solely or partly to making ^* financial supplies, or was solely or partly of a private or domestic nature.

10 Subsection 132-5(4)

that the acquisition, importation or application:

(a)

relates to the making of ^* financial supplies; or

(b)

is of a private or domestic nature.

11 Paragraph 135-5(1)(b)

12 Division 136 (heading)

Division 136—Bad debts relating to transactions that are not taxable or creditable to the fullest extent

Table of Subdivisions

136-A Bad debts relating to partly taxable or creditable transactions
136-B Bad debts relating to transactions that are taxable or creditable at less than ¹ /11 of the price

13 Section 136-1

136-1 What this Division is about

The amount of an adjustment that you have under Division 21 for a bad debt is reduced under this Division if the transaction to which the adjustment relates:

* was a supply that was partly taxable or an acquisition that was partly creditable; or

* was fully taxable or creditable, but not to the extent of ¹ /11 of the price or consideration for the transaction.

Subdivision 136-A—Bad debts relating to partly taxable or creditable transactions
14 Section 136-5

15 Subsections 136-10(1) and (2)

16 At the end of Division 136

Subdivision 136-B—Bad debts relating to transactions that are taxable or creditable at less than 1/11 of the price
136-30 Writing off bad debts (taxable supplies)

(1)

The amount of a ^* decreasing adjustment that you have under section 21-5, relating to a ^* taxable supply that is ^* taxable at less than ¹ /11 of the price, is worked out under this section and not under section 21-5.

(2)

This is how to work out the amount:

Method statement

Step 1. Work out the amount of GST (if any) that was payable on the supply, taking into account any previous ^* adjustments for the supply. This amount is the previous GST amount .
Step 2. Add together:

(a) the amount or amounts written off as bad from the debt to which the decreasing adjustment relates; and
(b) the amount of the debt that has been ^* overdue for 12 months or more (other than amounts already written off).

Step 3. Subtract the step 2 amount from the ^* price of the supply.
Step 4. Work out the amount of GST (if any), taking into account any previous ^* adjustments for the supply (but not adjustments relating to bad debts or debts overdue), that would be payable on the supply if the ^* price of the supply were the step 3 amount. This amount of GST is the adjusted GST amount .
Step 5. Subtract the adjusted GST amount from the previous GST amount.

136-35 Recovering amounts previously written off (taxable supplies)

(1)

The amount of an ^* increasing adjustment that you have under section 21-10, relating to a ^* taxable supply that is ^* taxable at less than ¹ /11 of the price, is worked out under this section and not under section 21-10.

(2)

This is how to work out the amount:

Method statement

Step 1. Work out the amount of GST (if any) that was payable on the supply, taking into account any previous ^* adjustments for the supply. This amount is the previous GST amount .
Step 2. Add together:

(a) the amount or amounts previously written off as bad from the debt to which the increasing adjustment relates; and
(b) the amount of the debt that has been ^* overdue for 12 months or more (other than amounts already written off).

Step 3. Subtract the step 2 amount from the ^* price of the supply.
Step 4. Add to the step 3 amount an amount equal to the amount or amounts, written off or overdue for 12 months or more, that have been recovered.
Step 5. Work out the amount of GST (if any), taking into account any previous ^* adjustments for the supply (but not adjustments relating to bad debts or debts overdue), that would be payable on the supply if the ^* price of the supply were the step 4 amount. This amount of GST is the adjusted GST amount .
Step 6. Subtract the previous GST amount from the adjusted GST amount.

136-40 Bad debts written off (creditable acquisitions)

(1)

The amount of an ^* increasing adjustment that you have under section 21-15, relating to a ^* creditable acquisition that is ^* creditable at less than ¹ /11 of the consideration, is worked out under this section and not under section 21-15.

(2)

This is how to work out the amount:

Method statement

Step 1. Work out the amount of the input tax credit (if any) to which you were entitled for the acquisition, taking into account any previous ^* adjustments for the acquisition. This amount is the previous credit amount .
Step 2. Add together:

(a) the amount or amounts previously written off as bad from the debt to which the increasing adjustment relates; and
(b) the amount of the debt that has been ^* overdue for 12 months or more (other than amounts already written off).

Step 3. Subtract the step 2 amount from the total amount of the ^* consideration that you have either provided, or are liable to provide, for the acquisition.
Step 4. Work out the amount of the input tax credit (if any), taking into account any previous ^* adjustments for the acquisition (but not adjustments relating to bad debts or debts overdue), to which you would be entitled for the acquisition if the ^* consideration for the acquisition were the step 3 amount. This amount of GST is the adjusted credit amount .
Step 5. Subtract the adjusted credit amount from the previous credit amount.

136-45 Recovering amounts previously written off (creditable acquisitions)

(1)

The amount of a ^* decreasing adjustment that you have under section 21-20, relating to a ^* creditable acquisition that is ^* creditable at less than ¹ /11 of the consideration, is worked out under this section and not under section 21-20.

(2)

This is how to work out the amount:

Method statement

Step 1. Work out the amount of the input tax credit (if any) to which you were entitled for the acquisition, taking into account any previous ^* adjustments for the acquisition. This amount is the previous credit amount .
Step 2. Add together:

(a) the amount or amounts previously written off as bad from the debt to which the decreasing adjustment relates; and
(b) the amount of the debt that has been ^* overdue for 12 months or more (other than amounts already written off).

Step 3. Subtract the step 2 amount from the total amount of the ^* consideration that you have either provided, or are liable to provide, for the acquisition.
Step 4. Add to the step 3 amount an amount equal to the amount or amounts, written off or overdue for 12 months or more, that you have paid.
Step 5. Work out the amount of the input tax credit (if any), taking into account any previous ^* adjustments for the acquisition (but not adjustments relating to bad debts or debts overdue), to which you would be entitled for the acquisition if the ^* consideration for the acquisition were the step 4 amount. This amount of GST is the adjusted credit amount .
Step 6. Subtract the previous credit amount from the adjusted credit amount.

136-50 Meanings of taxable at less than 1/11 of the price and creditable at less than 1/11 of the consideration

(1)

A ^* taxable supply is taxable at less than ¹ /11 of the price if the amount of GST payable on the supply is an amount that is less than ¹ /11 of the ^* price of the supply.

(2)

A ^* creditable acquisition is creditable at less than ¹ /11 of the consideration if the ^* taxable supply to which it relates is ^* taxable at less than ¹ /11 of the price.

17 Subsection 147-20(1)

(1)

If:

(a)

an ^* adjustment relates to a supply, acquisition or importation that an ^* incapacitated entity made before a ^* representative of the incapacitated entity was appointed; and

(b)

the adjustment arises after that appointment; and

(c)

in the case of an ^* increasing adjustment—the representative gives the Commissioner written notice that:

(i)

states that the adjustment has arisen in these circumstances; and

(ii)

specifies the amount of the adjustment;