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Edited version of private advice
Authorisation Number: 1012638021804
Ruling
Subject: WET and wine producer rebate
Question
Can you revise your activity statement to claim the wine producer rebate (PR) for previous wine sales to a purchaser who had provided an approved quotation form for the wine?
Answer
Please see reasons for decisions
Relevant facts:
• You are registered for the goods and services tax (GST) and wine equalisation tax (WET).
• You are a wine producer in Australia.
• You claim PR for your wine taxable dealing.
• However, you did not claim PR on your sales to a purchaser who had provided an approved quotation form.
• You treated the wine sales to the purchaser as non-taxable dealing (exemption based on quotation).
• On the quotation form, the purchaser stated that they did not intend to sell the wine GST-free.
• You advised that your total PR claims for the financial year was less than $500,000.
• You have not claimed any wine credits in relation to the wines sold.
Reasons for decision
The A New Tax System (Wine Equalisation Tax) Act 1999 (WET Act) provides a rebate of wine tax for producers of rebatable wine that are registered or required to be registered for GST. The maximum amount of rebate an Australian producer (or group of associated producers) can claim in a full financial year is $500,000, which equates to approximately $1.7 million (wholesale value) of eligible sales and applications to own use per annum.
Subsection 19-5 (1) of the WET Act states:
You are entitled to a *producer rebate for *rebatable wine for a *financial year if you are the *producer of the wine and:
(a) you are liable to wine tax for a *taxable dealing in the wine during the financial year; or
(b) you would have been liable to wine tax for a dealing in the wine during the financial year had the purchaser not *quoted for the sale at or before the time of the sale.
* denotes a defined term in the WET Act
However, section 19-10 of the WET Act provides that you are not entitled to a PR if the purchaser notifies you at or before the time of the purchase that they intend to make a supply of the wine that will be GST-free, or you have claimed a WET credit or a WET credit subsequently arises for you (other than because of a producer rebate).
As you are the producer of rebatable wine in Australia, you will only be entitled to the PR for wine manufactured by you where you are liable to wine tax for a taxable dealing with the wine during a financial year or you would have been liable for wine tax during the financial year if the purchaser has not quoted their ABN for the sale at or before the time of the sale.
A detailed explanation of PR entitlement for Australian wine producers is outlined in the Wine Equalisation Tax Ruling - Wine equalisation tax: operation of the producer rebate for other than New Zealand participants (WETR) 2009/2. We have enclosed a copy for your reference.
Conditions of claims
Where a wine producer has claimed a wine tax credit (WTC) or a WTC subsequently arises for the wine producer (other than a producer) for the dealing with the wine, the wine producer is not entitled to claim PR (subsection 19-10(2) of the WET Act).
In addition, subsection 19-15(2) of the WET Act provides that the maximum amount of producer rebate that a wine producer can claim in a financial year is $500,000.
Time limits for claims
There are time limits for claiming PR. Paragraph 215 of WETR 2009/1 states
For tax periods prior to 1 July 2012, for persons registered or required to be registered for GST, claims for credits of wine tax must be made within four years of the end of the tax period in which the wine tax credit arises. For tax periods from 1 July 2012, for persons registered or required to be registered for GST, claims for wine tax credits are subject to a time limit, generally four years from the date the entity lodged the return for the tax periods
Your claims
You are seeking to claim the PR in relation to wines previously sold to a purchaser who had provided an approved quotation form. The quotation was provided to you before the wine sales. On the form, the purchaser confirmed that they did not intend to sell the wines GST-free.
You confirmed that you have not claimed wine tax credits in relation to these wines. You also confirmed your producer rebates claims did not exceed $500,000 in the financial year. Therefore you are entitled to claim PR in relation to the wines sold to this purchaser as your claims are within the time limit.
Claiming PR
You may claim your PR by revising the last activity statement for the relevant financial year.
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