GST tax invoice information requirements

New GST Ruling GSTR 2013/1sets out the minimum information requirements for a tax invoice under s 29-70(1) of the A New Tax System (Goods And Services Tax) Act 1999 (GST Act).

It was issued in draft form as Draft GSTR 2012/D3, which in turn replaced a previous draft, Draft GSTR 2011/D1. The final Ruling applies on and from 1 July 2010 (although there are certain “transitional measures”, as discussed below). There were also a number of addenda to other rulings released in conjunction with GSTR 2013/1.

Background

A supplier must provide a tax invoice within 28 days of being requested to do so by the recipient. Input tax credits are generally not attributed to a tax period until the recipient holds a tax invoice for the creditable acquisition. An invoice is a document notifying an obligation to make a payment, whereas a “tax invoice” is a document that contains the information about a taxable supply required by the GST Act (specifically by s 29-70(1)). The s 29-70(1) information may not always appear on an invoice, although the Commissioner notes that a single document can be both an invoice and a tax invoice. Conversely, commercial documents such as lease agreements and contracts are tax invoices if they meet the s 29-70(1) requirements, but may not qualify as invoices: para 68 of the Ruling.

A recipient may issue a document that is both a “recipient created tax invoice” and a tax invoice. Generally, this occurs where the recipient of a supply also makes a supply to the entity that made the initial supply, eg a supply of sugar cane by a cane farmer to a sugar mill and the supply of services (analysis and testing of the sugar) by the sugar mill. The Ruling states that a tax invoice for both supplies combined on the one document will satisfy s 29-70(1): para 10.

In addition to setting out the ATO’s view of the information requirements contained in s 29-70(1), the Ruling also:

1. examines when a recipient of a document for a supply can treat that document as a tax invoice, even though it does not meet all of the tax invoice requirements (pursuant to s 29-70(1A));

2. explains when the Commissioner will treat a particular document as a tax invoice, even though that document does not meet all of the tax invoice requirements (pursuant to s 29-70(1B)); and

3. states the circumstances in which a supplier need not issue a tax invoice and where an input tax credit is attributable to a tax period, even if the recipient does not hold a tax invoice.

Requirements of tax invoices

It must be clear from the document that it was intended to be a tax invoice or recipient created tax invoice. This requirement may be satisfied by including the words “Tax Invoice”, “GST Invoice”, “Recipient Created Tax Invoice”, “Tax Invoice Issued by the Recipient” or “Recipient Created GST Invoice” in the heading of the document. A statement in the body of the document could also make the intention clear.

In the ATO’s view, a tax invoice cannot include words that indicate that the price of what is supplied is inclusive of GST to the extent the supply is not a taxable supply (eg if it is GST-free or input taxed). However, a supplier may issue a document headed “Tax Invoice” for a supply that is not a taxable supply if it shows that the price of the supply does not include GST.

A tax invoice must include information that establishes the identity of the supplier (and the recipient where applicable). Information sufficient to identify the supplier or recipient includes, but is not limited to, the legal name of the entity or the registered business name. A builder’s registration number or licence number is insufficient in itself to identify the supplier, or, where applicable, the recipient.

In the case where the supplier or the recipient is a trust, the identity of the trust must be clearly ascertainable from the document. Information sufficient to identify the trust includes, but is not limited to, a registered business name under which the trust’s enterprise is carried on. In some cases, the identity of the trust may be clearly ascertainable if the trustee’s name is included on the tax invoice. The trust’s ABN must also be clearly ascertainable.

Meaning of “clearly ascertained”

Section 29-70(1) provides that certain information must be able to be “clearly ascertained” from the information in the document before it will qualify as a tax invoice. The ATO states that where this information can only be determined by reference to another external source (such as the Australian Business Register) or another document, that information cannot be “clearly ascertained”.

GST groups

Where a member of a GST group makes a taxable supply, the identity of that member must be clearly ascertainable from the document. Where the recipient is a member of a GST group, the requirement that the recipient’s identity be clearly ascertainable will be satisfied if the document contains sufficient information to clearly show the identity of:

• the recipient;
• the GST group;
• the representative member; or
• another member of the GST group.

Price of what is supplied

A tax invoice must contain enough information to enable the price of what is supplied to be clearly ascertained. Where a contract is subject to a retention clause, the ATO states that the “price of what is supplied” is the total consideration payable including the retention amount. However, the tax invoice can also show the net amount payable while still satisfying this requirement. For example, the tax invoice may set out the price of what is supplied, separately show the retention amount, and show a net amount payable: para 30.

The Ruling discusses three ways in which an invoice may satisfy the requirement to display the extent to which each supply is a taxable supply.

Treating documents as tax invoices

Under s 29-70(1A), a recipient may treat a document that does not meet all the s 29-70(1) requirements as a tax invoice if:

• it would be a tax invoice but for the missing information; and

• all of that missing information can be clearly ascertained from other documents given to the recipient by the supplier.

The Ruling states this might be relevant where there is no information regarding the relevant particular, or the document contains information about the particular but that information is incomplete or incorrect (eg a transposition error). In such cases, the recipient may use a second document that identifies the information that is missing or wrong – and there is no requirement that the second document was intended to be a tax invoice: para 45.

The Commissioner emphasises that it is the choice of the recipient whether or not to treat a document as a tax invoice. Otherwise, it may request that the supplier issue a tax invoice or request that the Commissioner use the discretion in s 29-70(1B).

Section 29-70(1B) allows the Commissioner to treat a document as a tax invoice where it does not satisfy s 29-70(1). This will be exercised on a case-by-case basis, with the relevant factors addressed in Practice Statement Law Administration PS LA 2004/11. The treatment will apply to both the supplier and the recipient, although the Commissioner notes that it does not mean that the supplier has then satisfied the requirement to issue a tax invoice within the 28-day timeframe.

Waiver of tax invoice requirements

The Commissioner may determine under s 29-10(3) that an input tax credit is attributable without an invoice. These are contained in legislative determinations, which are listed in Appendix 2 to GSTR 2013/1. There are some 23 such determinations, ranging from acquisitions from property managers, to taxi travel and to an acquisition of a motor vehicle under a novated lease.

Date of effect

The Ruling applies on and from 1 July 2010. The ATO withdrew the former ruling on tax invoices (ie GSTR 2000/17) on 25 May 2011, when it issued Draft GSTR 2011/D1. The ATO stated that, as that Draft maintained the same outcomes as GSTR 2000/17, a document that satisfied the requirements as a tax invoice would continue to be considered as a tax invoice under the Draft Ruling. GSTR 2013/1 does not continue this administrative concession. The situations previously addressed in GSTR 2000/17 are now the subject of the s 29-10(3) legislative determinations discussed above. These instruments also have a date of effect of 1 July 2010.

Source: GSTR 2013/1, http://law.ato.gov.au/atolaw/view.htm?DocID=GST/GSTR20131/NAT/ATO/00001&PiT=99991231235958.