4-year credit time limit
Your entitlement to a GST credit ceases unless it is included in an assessment before the end of 4-year credit time limit.
The 4-year credit time limit ends 4 years after the lodgment due date of the BAS for the tax period in which you could have first claimed the GST credit (setting aside any requirement to hold a tax invoice).
If you account for GST on a cash basis, the earliest tax period in which you can claim a GST credit for a purchase is the tax period in which you make the payment. If you make the payment over multiple tax period, the 4-year credit time limit applies separately to each part of the payment.
If you account for GST on a non-cash (accruals) basis, the earliest tax period in which you can claim a GST credit for a purchase is the first tax period in which either:
- an invoice for the purchase is issued
- you provide part or all of the payment for your purchase.
Actions taken after the 4-year credit time limit ends can't revive your entitlement to a GST credit. We have no discretion to extend the 4-year credit time limit.
Example: time limit for GST credit (cash accounting)
Mia paid for office equipment in March 2020. Mia reports quarterly and on a cash basis.
The first tax period in which Mia could have claimed GST credits for the purchase of office equipment is her March 2020 quarterly tax period. Mia's BAS for this quarter is due on 28 April 2020. The 4-year credit time limit ends at the end of the day on 28 April 2024.
End of exampleWhen a GST credit is included in an assessment
A GST credit that you have included in your BAS for a tax period is included in your assessment for that tax period. The GST credit is included in your assessment on the day you lodge your BAS.
Where we make an amendment to your assessment to add additional GST credits, those credits will also be included in an assessment. These credits are included on the day we make the amended assessment.
When a GST credit is not included in an assessment
The following actions don't result in a GST credit being included in your assessment:
- applying for a private ruling
- making a request for an amendment to your assessment
- lodging a revised activity statement (this is treated as a request for an amendment to your assessment)
- making a voluntary disclosure.
These actions are requests for us to do something. Consideration of your request may take time. Any revision or amendment we make to your assessment as a result of your application or request may not be done on the day you make your request.
GST credits will only be included in your assessment if as a result of considering you request, we make a revision or amendment to your assessment. The GST credits will be included in the assessment at the time the revision or amendment is made.
If the 4-year credit limit has ended before any revision or amendment is made, your entitlement to the GST credit will have ceased and we can't revise or amend your assessment to include the GST credits, unless an exception applies. It doesn't matter if your application or request was made within the 4-year credit time limit for the GST credits or during the period of review for the assessment.
GST credits that you have not previously claimed don’t have to be claimed in the original tax period. You can claim the credits in your next BAS. However, the next BAS will need to be lodged within the 4-year credit time limit for those GST credits otherwise your entitlement to those credits will cease.
If you consider you are entitled GST credits that haven't been included in an assessment in which you could have first claimed them, we recommend you consider your options early and do not leave requests to the last minute.
If you are under current compliance activity, you should engage with the compliance team in relations to these options.
Objections
Lodging an objection request by itself does not result in a GST credit being included in your assessment.
But we may still be able to allow your GST credit if all of the following are met:
- you lodge a valid objection which includes your position that you are entitled to the unclaimed GST credits in the tax period
- the objection is lodged within the 4-year credit time limit for those GST credits
- we, or subsequent court or tribunal proceedings, agree you are entitled to the GST credits in that tax period.
If your objection is lodged outside the 4-year credit limit your entitlement to the GST credits will have ceased. This will be the case even if the objection was lodged in the objection time limits or is treated by us as being lodged within the objection time limits.
If unclaimed GST credits are not attributable to the tax period that the objection is for, the credits can't be allowed as part of the objection. If the 4-year time limit for those GST credits passes without the credits being included in an assessment, your entitlement to those credits will still cease.
Lodging a private ruling request, amendment request or a voluntary disclosure within the 4-year credit limit doesn't achieve the same outcome as lodging a valid objection within the 4-year credit time limit.
Period of review
The 4-year credit time limit is different to the period of review.
The period of review is the period during which we can amend your assessment. This is generally, 4 years from when you lodge your BAS. The period of review can be extended by an agreement or could be refreshed where there is an amendment. There are also some exceptions to this period where we can amend your assessment after the period ends. The 4-year credit limit is not an exception to the period of review.
While we might be able to amend your assessment (for example, where we are within the period of review or because of an exception to the period of review), we can't amend the assessment to include unclaimed GST credits if the 4-year credit time limit has ended and no exception applies.
Exceptions to the 4-year credit time limit
The first exception applies if, in the absence of fraud or evasion, you didn't claim a GST credit for an acquisition that you believed related to an input-taxed supply and an amendment is made on the basis that the supply is not input taxed.
You are able to claim the GST credit in these circumstances if we are still able to amend the assessment for the tax period to which the GST credit would have first been attributable.
The second exception applies where you ask us to treat a document as a tax invoice within the 4-year credit time limit. If we agree to your request after the 4-year credit time limit has ended, you will remain entitled to the GST credit.
For more information see:
• MT 2024/1: Miscellaneous Tax: time limits for claiming an input tax or fuel tax credit