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Ruling
Subject: GST and revocation of election for annual tax periods
Question
Can you revoke your election for annual tax periods and use quarterly tax periods with effect from 1 July 2011?
Advice
No.
Facts
You registered for GST effective 1 July 2011 and elected to have annual tax periods.
You have not made an election to pay GST by instalments.
Your GST turnover is less than $75,000.
In December 2011, you wrote to us asking to change your tax periods from annual to quarterly effective 1 July 2011. You stated that when you registered for GST, you incorrectly selected annual tax periods.
Relevant legislative provisions
A New Tax System (Goods and Services Tax) Act 1999 Subsection 151-25(1).
A New Tax System (Goods and Services Tax) Act 1999 Paragraph 151-25(1)(a).
A New Tax System (Goods and Services Tax) Act 1999 Subsection 151-25(2).
A New Tax System (Goods and Services Tax) Act 1999 Paragraph 151-25(2)(a).
A New Tax System (Goods and Services Tax) Act 1999 Paragraph 151-25(2)(b).
A New Tax System (Goods and Services Tax) Act 1999 Subsection 151-25(3).
A New Tax System (Goods and Services Tax) Act 1999 Section 195-1.
Reasons for decision
Paragraph 151-25(1)(a) of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act) provides that your annual tax period election ceases to have effect if you revoke it by notifying the Commissioner in the approved form.
Subsection 151-25(2) of the GST Act provides that:-
(2) A revocation of your election is taken to have had, or has, effect:
(a) if you notify the Commissioner on or before 28 October in a financial year - from the start of that *financial year; or
(b) if you notify the Commissioner after 28 October in a financial year -- from the start of the next financial year.
(* denotes a term defined in section 195-1 of the GST Act.)
Your letter dated December 2011 asking for the revocation of your annual tax periods election is accepted as a notification to the Commissioner in the approved form.
However, as you have not done so on or before 28 October 2011, you cannot revoke your election for the current financial year in accordance with paragraph 151-25(a) of the GST Act. The Commissioner has no administrative discretion to override obligations under this legislation.
Under subsection 151-25(3) of the GST Act the Commissioner can only disallow your election if you have failed to comply with one or more of your obligations under taxation law. As there is no evidence of such a failure the Commissioner cannot disallow your election.
Our records indicate that you are not at present required to be registered for GST, and you a not a member of a GST group. As a consequence there are no further grounds on which your election must be disallowed by the Commissioner.
Therefore you are unable to revoke your election for annual tax periods for the current 2011-2012 financial year. However, you may revoke your election for annual tax periods for the forthcoming 2012-2013 financial year if you contact the ATO again on or before 28 October 2012.