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  • Cancelled supplies and events frequently asked questions

    Answers to questions on:

    GST and cancelled taxable supplies

    Question: I reimbursed customers for a cancelled sale or no show. What do I do about the GST?

    Answer: If you reimburse a customer for a cancelled sale or no show, and you have already paid the GST to us, you can make a decreasing adjustment to reduce the amount of GST payable in your next activity statement.

    You must reimburse the customer before claiming back the GST as a decreasing adjustment.

    To reimburse a customer you can:

    • pay back their money
    • set off a mutual liability
    • issue a voucher.

    Example

    Johnny K Entertainment intended to hold a concert in April. In February, they sold 2,000 tickets for $110 including GST. They remitted the $20,000 GST to the ATO in their February monthly activity statement.

    In March, they cancelled the concert and refunded all ticket holders $110 each. In their March activity statement they included a decreasing adjustment of $20,000 (1/11th of refunded amount).

    End of example

    See also:

    This question was last updated on 17 March 2020.

    FBT and cancelled events

    Question: My employees were due to attend an event that has been cancelled. I paid for them to attend and the costs are non-refundable. Do I still have to pay FBT now that the event has been cancelled?

    Answer: No, you don’t have to pay FBT if you’re liable to pay for the non-refundable costs. This is an arrangement between you and event organisers, and you have not provided a fringe benefit to your employee.

    If the employees were liable to pay for their attendance at the cancelled event, and you reimbursed them, you may have to pay FBT as you’re providing an expense payment benefit – unless the otherwise deductible rule applies.

    See also:

    This question was last updated on 17 March 2020.

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    Last modified: 08 May 2020QC 62148