SALES TAX ASSESSMENT ACT 1992 (Repealed)

PART 3 - LIABILITY TO TAX

Division 2 - Exemptions

Subdivision C - Small business exemption

SECTION 29 (Repealed by 101 of 2006)   EXEMPTION FOR TAXPAYER WITH ANNUAL SALES TAX LIABILITY OF $10,000 OR LESS  

29(1)  [Certain assessable dealings exempt]  

This section exempts an assessable dealing (``the current dealing'') by a taxpayer who has a small annual sales tax liability.

29(2)  [Total tax liability $10,000 or less]  

The basic rule is that the current dealing is not taxable if the total tax liability for the current dealing and all countable dealings in the 12 months before the current dealing is $10,000 or less.

29(3)  [Reasonable expectation that liability will be $10,000 or less]  

In addition, at the time of the current dealing the taxpayer must have an expectation (based on reasonable grounds) that the total tax liability for the current dealing and all countable dealings in the 12 months after the current dealing will be $10,000 or less.

[Note:

Credits are not deducted in making calculations under subsections (2) and (3). Although section 53 allows credits to be deducted from the tax payable on a return, they do not affect the amount of the liability.]

29(4)  [Exemption not available in certain cases]  

The exemption is not available in any of the following cases:

(a)  the taxpayer obtained under quote the goods ( ``the current goods'' ) that are the subject of the current dealing;

(b)  the taxpayer has obtained a tax concession for any other goods that are connected with the current goods in the way described in subsection (5);

(c)  the current dealing is a customs dealing or is an AD3a or AD13a;

(d)  the current goods were manufactured by the taxpayer in circumstances covered by section 8; or

(e)  the current goods are Part 7A goods.

29(5)  [Conditions for obtaining a ``tax concession'']  

The taxpayer has obtained a tax concession for other goods ( ``the input goods'' ) that are connected with the current goods if both the following conditions are met:

(a)  the input goods are linked with the current goods in any of the following ways:

(i) the input goods, or some essential element of the input goods, has become an integral part of the current goods; [For example, the input goods were used as raw materials in manufacturing the current goods]

(ii) the input goods were first applied to the taxpayer's own use less than 2 years before the time of the current dealing and have been used by the taxpayer, in connection with the current goods, in carrying out an activity covered by an exemption [R] Item (whether or not the taxpayer was registered at the time of using the input goods or at any other relevant time); [For example, the input goods were machinery used in manufacturing the current goods]

(iii) something that formed part of the input goods at the time of an assessable dealing with the input goods has become an integral part of the current goods; [For example, some part of defective input goods that were returned by a purchaser has been re-used in manufacturing the current goods]

(b)  either of the following applies:

(i) the taxpayer has not borne tax on the input goods before the time of the current dealing, but would have borne tax except for the operation of an exemption [R] Item; or

(ii) the taxpayer has borne tax on the input goods before the time of the current dealing, but has become entitled to a credit for any of that tax.

29(6)  [Tax to be calculated as if a taxable dealing]  

The tax on the current dealing, and on any countable dealing that was exempted by this section, is to be calculated on the assumption that the dealing is or was a taxable dealing.

29(7)  [Definitions]  

In this section:

``countable dealing'' means any assessable dealing except:

(a)  a customs dealing;

(b)  a dealing that would have been exempted from tax because of an exemption [R] Item, if the taxpayer had been registered at the time of the dealing;

(c)  a dealing with Part 7A goods.

``total tax liability'' does not include tax to the extent that it is payable as a result of the operation of section 15A of the Sales Tax (Exemptions and Classifications) Act 1992.[Appendix B has a chart for use in deciding whether the small business exemption is available for a particular dealing.]