A New Tax System (Goods and Services Tax) Act 1999

Chapter 4 - The special rules  

Part 4-2 - Special rules mainly about supplies and acquisitions  

Note:

The special rules in this Part mainly modify the operation of Part 2-2 , but they may affect other Parts of Chapter 2 in minor ways.

Division 75 - Sale of freehold interests etc.  

75-22   Increasing adjustment relating to input tax credit entitlement  

(1)    
You have an increasing adjustment if:

(a) you make a * taxable supply of * real property under the * margin scheme ; and

(b) an acquisition that you made of part of the interest, unit or lease in question was made through a supply that was * ineligible for the margin scheme ; and

(c) you were, or are, entitled to an input tax credit for the acquisition.

The amount of the increasing adjustment is an amount equal to the * previously attributed input tax credit amount for the acquisition.

(2)    
You have an increasing adjustment if:

(a) you make a * taxable supply of * real property under the * margin scheme ; and

(b) you acquired all or part of the interest, unit or lease in question by inheriting it; and

(c) the entity from whom you inherited (the deceased ) had acquired part of the interest, unit or lease that you inherited through a supply that was * ineligible for the margin scheme ; and

(d) the deceased was entitled to an input tax credit for that acquisition.

The amount of the increasing adjustment is an amount equal to the * previously attributed input tax credit amount for the acquisition.

(3)    

You have an increasing adjustment if:

(a) you make a * taxable supply of * real property under the * margin scheme ; and

(b) an acquisition that you made of part of the interest, unit or lease in question was made through a supply that was * ineligible for the margin scheme because of paragraph 75-5(3)(e), (f), or (g) ; and

(c) the entity from whom you made the acquisition had been entitled to an input tax credit for its acquisition.

(4)    

You have an increasing adjustment if:

(a) you make a * taxable supply of * real property under the * margin scheme ; and

(b) the acquisition that you made of the interest, unit or lease in question:

(i) was made through a supply that was * GST-free under Subdivision 38-J or Subdivision 38-O ; or

(ii) was made through a supply (other than a taxable supply) from your * associate without * consideration and in the course or furtherance of an * enterprise that your associate * carried on ; or

(iii) was made from your associate but not by means of a supply from your associate; and

(c) the entity from whom you acquired the interest, unit or lease:

(i) acquired part of the interest, unit or lease through a supply that would have been * ineligible for the margin scheme if it had been a supply of the whole of the interest, unit or lease; and

(ii) had been entitled to an input tax credit for its acquisition; and

(iii) was * registered or * required to be registered , at the time of your acquisition of the interest, unit or lease.

(5)    

The amount of the * increasing adjustment under subsection (3) or (4) is an amount equal to 1/11 of:

(a) if you choose to apply an * approved valuation to work out the amount - an approved valuation of the part of the interest, unit or lease referred to in paragraph (3)(b) or subparagraph (4)(c)(i) as at the day on which the entity had acquired it; or

(b) otherwise - the * consideration for the entity ' s acquisition of that part of the interest, unit or lease.