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

Chapter 4 - The special rules  

Part 4-1 - Special rules mainly about particular ways entities are organised  


The special rules in this Part mainly modify the operation of Part 2-2 so far as that Part deals with liability for GST and entitlement to input tax credits, but the special rules also affect other aspects of Part 2-2 and the other Parts of Chapter 2 .

Division 58 - Representatives of incapacitated entities  

58-15   Adjustments for bad debts  

For the purposes of determining whether an *adjustment arises under section 21-5 or 21-15 for the whole or a part of a debt relating to a *taxable supply or *creditable acquisition for which a *representative of an *incapacitated entity is liable to pay GST, or is entitled to an input tax credit, under section 58-10 :

(a) the adjustment cannot arise if, when the whole or part of the debt is written off, or has been *overdue for 12 months, the representative *accounts on a cash basis ; but

(b) it does not matter whether the incapacitated entity accounts on a cash basis at that or any other time.

This section has effect despite subsections 21-5(2) and 21-15(2) (which preclude adjustments for bad debts when accounting on a cash basis).

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