Part 9 - Vouchers

Issue: What is the effect where a charity provides vouchers for people in need or pays their bills directly?

Non-interpretative – straight application of the law


In order for an entity to claim input tax credits it must have made a creditable acquisition. A creditable acquisition arises when the following are satisfied:

  • there is an acquisition of a thing
  • the thing is acquired by an entity that is registered for GST or required to be registered for GST
  • there is consideration
  • the supply was a taxable supply
  • the acquisition of the thing was for a creditable purpose.

The ATO has issued ruling GSTR 2006/4External Link on determining the extent of creditable purpose for claiming input tax credits and for making adjustments for changes in extent of creditable purpose.

What tests will be applied to 'input tax credits'?

Entities making taxable or GST-free supplies will be able to claim input tax credits for any purchases that are creditable acquisitions which are made as part of their enterprise. Where the supplies are input taxed the entity is not entitled to input tax credits that relate to that supply.

If you are exempt from income tax, an acquisition that you make that would be a non-deductible expense under the Income Tax Assessment Acts is not a creditable acquisition, for example, entertainment, club and leisure facilities.

    Last modified: 18 Nov 2013QC 27139