A New Tax System (Goods and Services Tax) Act 1999
Chapter 4
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The special rules
Part 4-6
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Special rules mainly about tax periods
If:
(a) the GST payable by you on a * taxable supply , or the input tax credit to which you are entitled for a * creditable acquisition , was attributable to a tax period during which you were not * accounting on a cash basis ; and
(b) at a time when you are accounting on a cash basis, the whole or part of a debt relating to the * consideration for the supply or acquisition is written off as bad;
(2)
This section has effect despite subsections 21-5(2) and 21-15(2) (which preclude adjustments for bad debts when accounting on a cash basis).
Note:
The special rules in this Part mainly modify the operation of Part 2-6 , but they may affect other Parts of Chapter 2 in minor ways.
Division 159 - Changing your accounting basis 159-25 Starting to account on a cash basis - bad debts (1)If:
(a) the GST payable by you on a * taxable supply , or the input tax credit to which you are entitled for a * creditable acquisition , was attributable to a tax period during which you were not * accounting on a cash basis ; and
(b) at a time when you are accounting on a cash basis, the whole or part of a debt relating to the * consideration for the supply or acquisition is written off as bad;
the amount written off, and any part of that amount that is recovered, is to be treated, for the purposes of Division 21 , as if at all relevant times you were not accounting on a cash basis.
(2)
This section has effect despite subsections 21-5(2) and 21-15(2) (which preclude adjustments for bad debts when accounting on a cash basis).
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