Goods and services tax and indirect taxes
This domain tests GST liability on supplies and acquisitions, documentation, adjustments and the special rules for property, imports and groupings, plus a working knowledge of wine equalisation tax and luxury car tax.
Taxable supplies and classifications
- Section 9-5 requires a registered entity, an enterprise, consideration and a connection with the indirect tax zone.
- GST-free supplies include exports, health, education, fresh food and going concerns; input taxed supplies include residential rent and financial supplies.
- Registration threshold is $75,000 ($150,000 for non-profits); rideshare and taxi drivers are registered from the first dollar.
Documentation and credits
- Tax invoices are required for supplies of $1,000 or more, and for all input tax credit claims.
- Creditable purpose is apportioned where acquisitions are used partly privately; adjustments follow changed use or events.
- Special rules include the margin scheme, GST groups, reverse charge on offshore supplies and low value imported goods.
Worked example
A registered café has GST-inclusive sales of $220,000 and GST-inclusive purchases of $110,000, and buys a $13,200 coffee machine used 90% for the business. GST on sales = $20,000. Credits: $10,000 on purchases plus 90% × $1,200 = $1,080 on the machine, one cent of $13,200 is $1,200. Net amount payable = $20,000 − $11,080 = $8,920.
Indirect taxes
- Wine equalisation tax is 29% of the wholesale value, with a producer rebate; luxury car tax is 33% above the threshold, with a higher threshold for fuel-efficient vehicles.
- Fuel tax credits are claimed on eligible business fuel use.
Traps
- Claiming full credits on assets with private use.
- Treating an export as GST-free without shipping within the required period.
- Applying the margin scheme to new residential premises, where it is unavailable.
- Missing the four-year limit on refunds and adjustments.