WTI 2016/33 - Explanatory statement

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COMMONWEALTH OF AUSTRALIA

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

Explanatory Statement

General outline of determination

1. This determination is made under subsection 29-10(3) of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act).

2. The determination waives the requirement for an account holder of Choice Hotels corporate charge card(s) to hold a tax invoice when claiming an input tax credit in a tax period for creditable acquisitions acquired using the corporate charge card provided that the account holder holds the corporate card statement which satisfies the requirements of the determination.

3. The determination is a legislative instrument for the purposes of the Legislative Instruments Act 2003.

Date of effect

4. The determination commences on the day after registration.

What is this determination about?

5. Under subsection 29-10(3) of the GST Act, a recipient can only claim an input tax credit for a creditable acquisition in the first tax period when they hold a tax invoice (unless the value of the taxable supply is $75 or less).

6. This determination waives the requirement for an account holder of Choice Hotels corporate charge card(s) to hold a tax invoice when attributing input tax credits for creditable acquisitions to a tax period, where the relevant corporate card statement held by the account holder meets the requirements of this determination.

What is the effect of this determination?

4. The effect of the determination will reduce compliance costs for account holders of Choice Hotels corporate charge card(s) when claiming input tax credits for creditable acquisitions acquired from hotels and motels from the Choice Hotels franchise. Account holders will not be required to hold individual tax invoices for each creditable acquisition acquired from Choice Hotels franchise when they (or their directors or employees) use the corporate charge card to acquire these goods and services. This is on the proviso that they hold a corporate card statement which meets the requirements of the determination at the time they lodge their GST return.

5. Compliance cost impact: minor - there will be no or minimal impacts for both implementation and ongoing compliance costs. The determination is minor or machinery in nature.

Background

6. This determination replaces A New Tax System (Goods and Services Tax) Waiver of Tax Invoice Requirement Determination (No. 5) 2000 - holders of Corporate Charge Invoice/Statement issued by Flag Choice Hotels Limited (the previous determination). The replaced instrument is repealed on commencement of this determination.

Consultation

7. Consultation was undertaken directly with Choice Hotels to ensure the currency of the circumstances described in the determination.

Statement of Compatibility with Human Rights

Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011

Goods and Services Tax: Waiver of Tax Invoice Requirement Determination (No. 33) 2016 - Choice Hotels Corporate Charge Card

This Legislative Instrument is compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.

Overview of the Legislative Instrument

This Legislative Instrument waives the tax invoice requirement for account holders of Choice Hotels corporate card(s) to claim input tax credits for creditable acquisitions they acquire from the Choice Hotels franchise. This is on the proviso that they hold the corporate charge card statement that meets the requirement of the Legislative Instrument at the time they lodge their GST return.

Human rights implications

This Instrument does not engage any of the applicable rights or freedoms. It allows for the streamlining invoicing and bookkeeping practices.

Conclusion

This instrument is compatible with human rights as it does not raise any human rights issues.

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26 February 2016

Timothy Dyce
Deputy Commissioner of Taxation

Legislative References:
A New Tax System (Goods And Services Tax) Act 1999
The Act

Legislative Instruments Act 2003
the Act

Related Legislative Determinations:
WTI 2016/33