Financial Services

GST Tax Invoices Policy

According to the amount of money an invoice is charging, different rules apply.

Policy statement

Invoices for inputs

Subject to the exceptions below, input tax credits equal to the amount of GST paid on goods and/or services, may only be claimed from the Australian Taxation Office (ATO) where the University is supplied with a valid tax invoice.

An exemption from this rule is where the value of the transaction does not exceed $55 (inclusive of GST). In this case the University may claim the GST charged without the requirement of having to hold a tax invoice. However, the University still needs to have the invoice for substantiation purposes.

Exceptions: the University is not eligible to claim back GST paid on:

  • expenses incurred in deriving an input-taxed supply
  • expenses greather than $55 (GST-inclusive) where a valid tax invoice is not held
  • non-deductible expenses such as recreational club expenses and entertainment expenses
  • expenses of a private or domestic nature.

The ATO considers a number of things supplied together as one taxable supply. For example, if the transaction comprises the sale of five items, each with a value of $20, then a tax invoice is required because the total value of the taxable supply exceeds $55.

Generally a tax invoice will be provided automatically at the time of the purchase. However if one is not supplied, staff must request a tax invoice be issued (whether the payment for the supply is made via accounts payable, corporate card, petty cash, cash advance or reimbursement of personal expense).

The supplier is required to provide a valid tax invoice within 28 days of request by the recipient.

Tax invoices for outputs

Whenever the University provides a taxable supply, the University will be required to provide a tax invoice to enable the recipient of the supply to claim input tax credits.

Back to top

Format of tax invoices

If the total amount payable falls between $55 and $1000 (GST-inclusive), the following information must be included on an invoice to meet the requirements of a valid tax invoice:

  • the words "Tax Invoice" stated prominently
  • supplier's Australian Business Number (ABN)
  • supplier's name
  • date of issue of tax invoice
  • itemised description of the supplies
  • price of the supply andeither the total amount of GST or where the GST is exactly 1/11th of the total price, a statement that the price is GST inclusive.

If the total amount payable totals $1000 or more, the valid tax invoice must include the following additional information:

  • quantities of each item or extent of services supplied
  • customer name
  • customer address or ABN if address not supplied.

Mixed supplies

Where the tax invoice is for a 'mixed' or composite supply, the valid tax invoice must also show:

  • each taxable sale
  • the amount of GST to be paid for taxable sales
  • the amount to be paid for the total sale.

Recipient-created tax invoices (RCTIs)

Compliant Recipient-created tax invoices are issued by the recipient of the supply, rather than the supplier.

Before an RCTI can be issued, an RCTI Agreement must be entered into between the recipient and the supplier.

Subscription forms/conference registration forms

Subscription forms, conference registration forms or other documents that are merely offers issued by the University to allow/encourage as follows:

  • existing subscribers to renew their subscriptions
  • new subscribers to sign up
  • register attendance to conferences/seminars/workshops.

These forms are merely an offer at the stage of issue (not a tax invoice) as the University may be unsure whether a taxable supply in the form of a renewal or sale will eventuate. To save the University from having to issue another document (tax invoice) if the offer is accepted, the ATO will treat the offer document as a tax invoice when payment is made, so long as the document includes:

  • the details required to qualify as a tax invoice (Format of Tax Invoices)
  • the following, or similar, statement: 'This document will be a tax invoice for GST when you make a payment.'

Back to top 

Requests for copies of tax invoices

Occasionally after the University has issued a tax invoice, the recipient of the supply may request another copy if the original was lost or destroyed. The copy of the tax invoice or second tax invoice must be marked 'copy' or 'duplicate' to enable easy identification of that document.

Input tax credits may be claimed on invoice copies/re-issues provided that the credits have not already been claimed on the original.

Single document for multiple tax invoices

Suppliers of periodic or progressive taxable supplies do not need to issue separate tax invoices for each component of the supply. A single document can be a tax invoice for all components of the supply if it satisfies the requirements of a valid tax invoice.

Examples of single documents that may be used as tax invoices if the tax invoice requirements are satisfied include:

  • contracts
  • commercial agreements.

Adjustment notes

When adjustments are made to the value of previously charged taxable supplies, an adjustment note is required.

Under the GST Act, an adjustment event occurs in the following situations:

  • cancelled sale
  • returned goods
  • discount/part refund/rebate applied
  • error in original invoice
  • error in delivery affecting the transaction value
  • change in the GST status of the transaction.

Format of adjustment notes

For all adjustments between $55 and $1000 (GST-inclusive), the following information must be included on an adjustment note to meet the requirements of a "Tax Adjustment Note":

  • the words "Adjustment Note" prominently displayed
  • supplier's Australian Business Number (ABN)
  • supplier's name
  • issue date of the adjustment note
  • a description of the reason for the adjustment (discount, refund, return)
  • price of the supply as per the original tax invoice, the adjusted price of the supply and the adjustment value
  • the amount of the adjustment to the GST payable, or a statement to the effect that the difference in price of the taxable supply includes GST

For all adjustments $1000 or more (GST-inclusive), the tax adjustment note must include:

  • customer's name
  • customer's address or ABN if address not supplied.

The supplier must issue an adjustment note within 28 days of the earlier of receiving a request by the recipient of the supply, or becoming aware of the adjustment.

Recipient-created adjustment notes (RCANs)

Where the original transaction was subject to an RCTI, an RCAN is required on an adjustment event –that is, the recipient of the initial supply issues the RCAN on behalf of the supplier.

Back to top

Accounting treatment

Invoices received from suppliers – inputs

As incoming invoices are processed through accounts payable, GST input credits and expenses are costed to the General Ledger.

  1. The Expense account is debited with the GST-exclusive amount in the profit and loss account.
  2. The GST inputs account is debited with the amount of the GST input credit available in the Balance Sheet.
  3. The Creditor's account is credited with the GST-inclusive amount.
Example 1
Dr Stationery 10
Dr GST Inputs 1
Cr Accounts Payable 11

Invoices charged out to customers –­ outputs

As outgoing invoices are processed through accounts receivable GST outputs and income accounts are credited in the General Ledger:

  • The Income account is credited with the GST-exclusive amount in the profit and loss account.The GST outputs account is credited with the amount of the GST applicable in the balance sheet.
  • The Debtor's account is debited with the GST-inclusive amount.
Example 2
Dr Accounts Receivable 33
Cr GST Outputs 3
Cr Consulting income 30

The resulting difference between the GST inputs and GST outputs accounts are remitted to, or refunded from, the ATO on a monthly basis. This function is performed centrally by Financial Services.

Back to top