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

Chapter 4 - The special rules  

Part 4-2 - Special rules mainly about supplies and acquisitions  

Note:

The special rules in this Part mainly modify the operation of Part 2-2 , but they may affect other Parts of Chapter 2 in minor ways.

Division 78 - Insurance  

Subdivision 78-E - Statutory compensation schemes  

78-100   Settlements of claims for compensation under statutory compensation schemes  

(1)    

Subsection 38-60(1) and this Division apply in relation to a payment or supply made in settlement of a claim for compensation under a * statutory compensation scheme in the same way that they apply to a payment or supply made in settlement of a claim under an * insurance policy .

Note:

Subsection 38-60(1) provides that certain supplies to insurers are GST-free.

(2)    

For the purposes of the application of subsection 38-60(1) and this Division in relation to such a payment or supply:

(a) the claim for compensation under the scheme is treated as a claim under an * insurance policy ; and

(b) the entity operating the scheme is treated as the insurer; and

(c) an entity is treated as the entity insured if:

(i) the entity ' s payment of premiums, contributions or similar payments under the scheme, or payment of levy in connection with the scheme; or

(ii) the entity ' s liability to pay premiums, contributions or similar payments under the scheme, or liability to pay levy in connection with the scheme;

enabled the claim for compensation to arise; and

(ca) those payments that that entity makes or is liable to make are treated as a premium it has paid; and

(d) the supply of membership of, or participation in, the scheme is treated as the supply of an * insurance policy .

(3)    

However, if the entity treated as the entity insured:

(a) is liable to make payments referred to in paragraph (2)(c); and

(b) has not made all those payments;

for the purposes of sections 78-10 and 78-15 , the entity ' s entitlement to an input tax credit for the premium paid is taken to be what its entitlement would have been if it had made all those payments.