Australia

A New Tax System (Goods and Services Tax) Act


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the acquisition.

      19–80 Increasing adjustments for acquisitions

      If the *previously attributed input tax credit amount is greater than the *corrected input tax credit amount, you have an increasing adjustment equal to the difference between the previously attributed input tax credit amount and the corrected input tax credit amount.

      19–85 Decreasing adjustments for acquisitions

      If the *previously attributed input tax credit amount is less than the *corrected input tax credit amount, you have a decreasing adjustment equal to the difference between the corrected input tax credit amount and the previously attributed input tax credit amount.

      19–99 Special rules relating to adjustment events

      Chapter 4 contains special rules relating to *adjustment events in particular cases, as follows:

      Checklist of special rules

      Item

      For this case…

      See:

      1AA

      Compulsory third party schemes

      Division 79

      1A

      GST religious groups

      Division 49

      1

      Insurance

      Division 78

      2

      Non-deductible expenses

      Division 69

      2A

      Providing additional consideration under gross-up clauses

      Division 133

      3

      Settlement sharing arrangements

      Division 80

      4

      Third party payments

      Division 134

      Division 21—Bad debts

      21-1 What this Division is about

      If debts are written off as bad or are outstanding after 12 months, adjustments (for the purpose of working out net amounts) are made. They can arise both for amounts written off or outstanding and for recovery of amounts previously written off or outstanding.

      Note: This Division does not apply to supplies and acquisitions that you account for on a cash basis (except in the limited circumstances referred to in Division 159).

      21-5 Writing off bad debts (taxable supplies)

      (1) You have a decreasing adjustment if:

      (a) you made a *taxable supply; and

      (b) the whole or part of the *consideration for the supply has not been received; and

      (c) you write off as bad the whole or a part of the debt, or the whole or a part of the debt has been *overdue for 12 months or more.

      The amount of the decreasing adjustment is 1/11of the amount written off, or 1/11 of the amount that has been overdue for 12 months or more, as the case requires.

      (2) However, you cannot have an *adjustment under this section if you *account on a cash basis.

      21–10 Recovering amounts previously written off (taxable supplies)

      You have an increasing adjustment if:

      (a) you made a *taxable supply in relation to which you had a *decreasing adjustment under section 21-5 for a debt; and

      (b) you recover the whole or a part of the amount written off, or the whole or a part of the amount that has been *overdue for 12 months or more, as the case requires.

      The amount of the increasing adjustment is 1/11of the amount recovered.

      21–15 Bad debts written off (creditable acquisitions)

      (1) You have an increasing adjustment if:

      (a) you made a *creditable acquisition for *consideration; and

      (b) the whole or part of the consideration is *overdue, but you have not provided the consideration overdue; and

      (c) the supplier of the thing you acquired writes off as bad the whole or a part of the debt, or the whole or a part of the debt has been overdue for 12 months or more.

      The amount of the increasing adjustment is 1/11of the amount written off, or 1/11 of the amount that has been overdue for 12 months or more, as the case requires.

      (2) However, you cannot have an *adjustment under this section if you *account on a cash basis.

      21–20 Recovering amounts previously written off (creditable acquisitions)

      You have a decreasing adjustment if:

      (a) you made a *creditable acquisition in relation to which you had an *increasing adjustment under section 21–15 for a debt; and

      (b) you pay to the supplier of the thing you acquired the whole or a part of the amount written off, or the whole or a part of the amount that has been *overdue for 12 months or more, as the case requires.

      The amount of the decreasing adjustment is 1/11of the amount recovered.

      21–99 Special rules relating to adjustments for bad debts

      Chapter 4 contains special rules relating to adjustments for bad debts, as follows:

      Checklist of special rules

      Item

      For this case…

      See:

      1A

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

      Division 136

      1

      Changing your accounting basis

      Division 159

      2

      Gambling

      Division 126

      2A

      Representatives of incapacitated entities

      Division 58

      3

      Sale of freehold interests etc.

      Division 75

      Part 2–5—Registration

      Division 23—Who is required to be registered and who may be registered

      23-1 Explanation of Division

      This diagram shows when you are required to be, and when you may, be registered.

      Note: This section is an explanatory section.

      23-5 Who is required to be registered

      You are required to be registered under this Act if:

      (a) you are *carrying on an *enterprise; and

      (b) your *GST turnover meets the *registration turnover threshold.

      Note: It is the entity that carries on the enterprise that is required to be registered (and not the enterprise).

      23–10 Who may be registered

      (1) You may be *registered under this Act if you are carrying on an *enterprise (whether or not your *GST turnover