• Using invoices with a WEG label in the wine industry

    Attention

    Terms we use

    When we refer to:

    • GST credit, we mean the GST term input tax credit
    • purchase, we mean the GST term acquisition
    • sale, we mean the GST term supply.
    End of attention

    Do you need to identify GST and WET separately on tax invoices?

    You must identify wine equalisation tax (WET) and goods and services tax (GST) separately on tax invoices for GST purposes.

    If an invoice does not separately show these amounts, it is not considered a valid tax invoice and cannot be used to claim GST credits.

    Some businesses in the wine industry are using accounting packages to generate invoices which give a combined GST and WET amount, where both taxes apply.

    This combined figure is shown at a wine equalisation tax-goods and services tax (WEG) label on the invoice. An invoice that only contains a WEG figure does not contain all of the necessary information for it to be a tax invoice.

    What is a tax invoice?

    Under GST law a valid tax invoice is a document that meets all of the following requirements:

    • it is issued by the supplier, unless it is a recipient created tax invoice (RCTI) (in which case it is issued by the recipient)
    • it contains enough information to enable the following to be clearly identified
      • the supplier's identity and Australian business number (ABN)
      • a brief description of what is sold, including the quantity (if applicable) and the price of what is sold
      • the extent to which each sale is a taxable sale - this can be shown separately or, if the GST to be paid is exactly one-eleventh of the total price, as a statement such as 'total price includes GST'
      • the date the document is issued
      • the amount of GST (if any) payable for each sale
      • if the document was issued by the recipient and GST is payable for any sale - that the GST is payable by the supplier
      • that the document was intended to be a tax invoice or an RCTI if it was issued by the recipient.

    In addition, if the total price of the sale is at least $1,000 or if the document was issued by the recipient, the recipient's identity or ABN must be able to be clearly identified.

    If a supplier issues a tax invoice and includes a figure at the WEG label, this is not sufficient information to clearly show the amount of GST payable, as it may be combined with an amount of WET. However, if a supplier issues an invoice that contains a figure at the WEG label, but also includes sufficient information (as outlined above), this is a tax invoice for GST purposes.

    Further Information

    For more information on tax invoices, refer to Valid tax invoices and GST credits (NAT 12358).

    End of further information

    What is an incomplete tax invoice?

    A tax invoice is incomplete if it does not include all the required information or it contains an error. In this case the recipient can only treat that document as a tax invoice if the missing information or information to correct the errors is obtained from other documents provided by the supplier. However, this does not apply to RCTIs.

    What if the invoice held only has a total WEG amount?

    If you have an invoice issued by your supplier with a figure at the WEG label only and you do not have another document from them to show the break-down of the GST and WET included in the total amount payable, you cannot claim the amount at the WEG label as a GST credit. This is because:

    • the invoice is not a tax invoice
    • the amount at the WEG label may also include an amount of WET, which you cannot claim as a GST credit.

    However, if you hold an invoice issued by your supplier with a figure at the WEG label, and have another document from the supplier which will allow you to work out the break-down of the GST and WET included in the total amount payable for the purchase, you may claim the GST amount as a GST credit.

    What if your purchases are of low value (less than $82.50)?

    You do not need to have a tax invoice to claim a GST credit for a purchase of less than $82.50 (GST inclusive). However, to claim a GST credit, you must be able to identify the amount of GST included in the price of the sale. If you can't distinguish the amount of GST from any amount of WET on the invoice, you can't claim a GST credit. You cannot claim GST credits on any amount that includes WET.

    What if an invoice only has an amount at the WEG label?

    For sales over $82.50 in value, you must have a tax invoice before you can claim a GST credit for the amount of GST included in the price of the sale. If your suppliers issue invoices for wines or similar products that only have an amount at the WEG label and no break down of GST and WET amounts, you can ask them to issue you a valid tax invoice.

    If you ask for a tax invoice the supplier must issue one within 28 days of your request. If your supplier fails to do so they may be penalised.

    To avoid further confusion, we recommend that suppliers issuing invoices only showing an amount at the WEG label either:

    • change the heading from 'tax invoice' to 'invoice'
    • include all the information for a tax invoice - regardless of whether or not the invoice contains an amount at the WEG label.

    More information

    For more information:

    • phone us on 13 28 66, or
    • write to us at

    Australian Taxation Office
    PO Box 3524
    ALBURY  NSW  2640.

    If you do not speak English well and need help from us, phone the Translating and Interpreting Service on 13 14 50.

    If you are deaf, or have a hearing or speech impairment, phone the ATO through the National Relay Service (NRS) on the numbers listed below:

    • TTY users, phone 13 36 77 and ask for the ATO number you need
    • Speak and Listen (speech-to-speech relay) users, phone 1300 555 727 and ask for the ATO number you need
    • internet relay users, connect to the NRS on www.relayservice.com.au and ask for the ATO number you need.
      Last modified: 16 Mar 2012QC 16340