SAM 2004/1

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AUSTRALIAN GOVERNMENT

This legislative instrument has been repealed by SAM 2015/28 - A New Tax System (Goods and Services Tax) Act 1999 Simplified GST Accounting Methods Determination (No. 28) 2015.

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

Under subsection 123-5 (1) of the A New Tax System (Goods and Services Tax) Act 1999, I make the following determination:

Citation

1. This determination may be cited as the A New Tax System (Goods and Services Tax) Act 1999 Simplified GST Accounting Methods Determination (No. 1) 2004.

Commencement and application

2. (1) This determination commences on 1 April 2004.

(2) This determination does not revoke or vary any previous determination made by the Commissioner or a delegate of the Commissioner.

(3) This determination applies in relation to net amounts for tax periods starting on or after 1 January 2004.

Defined terms

3. Some terms in this determination are shown in bold italics when first used. They are defined in clause 7.

4. Terms in this determination that are defined in the GST Act have the same meaning as in the GST Act.

Eligibility

5. A government entity may choose to use the simplified accounting method specified in clause 6 to calculate its net amount, in so far as the net amount relates to supplies and acquisitions made through a sub-entity of the government entity, if:

(a)

the government entity is a retailer; and

(b)

the government entity is registered; and

(c)

through the sub-entity, the government entity sells both taxable and GST-free food at the same premises in the course or furtherance of carrying on the government entity's enterprise; and

(d)

the sub-entity's main activity is selling food and it mainly sells the food in an unchanged form; and

(e)

the sub-entity's annual turnover would not exceed $1 million (if it were calculated as though the sub-entity were a separate entity); and

(f)

the sub-entity is located in a prison or other institution where people are lawfully detained; and

(g)

the sub-entity does not have point-of-sale equipment that can:

(i)

identify and record each separate supply as being GST-free or taxable; and

(ii)

identify and record the total amount of its GST-free sales and the total amount of its sales.

The government entity's notice of its choice must specify the sub-entities for which the government entity chooses to use the simplified accounting method.

Simplified Accounting Method

6. The simplified accounting method is, in working out the government entity's net amount, either:

(a)

the GST payable by the government entity on the taxable supplies made through each sub-entity to which its choice applies must be estimated using method A ; or

(b)

the GST payable by the government entity on the taxable supplies made through each sub-entity to which its choice applies, and the government entity's entitlement to input tax credits on creditable acquisitions made through each of those sub-entities, must be estimated using method B.

The government entity's notice of its choice must specify whether it chooses to use method A or method B. The government entity may not choose to use method A for some sub-entities and method B for other sub-entities.

Definitions

7. In this determination:

four-week sample period means any continuous four-week period that occurs between either:

(a)

1 June - 31 July (to cover the tax periods that begin between the first day of that July and the last day of the following December inclusive); or

(b)

1 December - 31 January (to cover the tax periods that begin between the first day of that January and the last day of the following June inclusive).

GST Act means the A New Tax System (Goods and Services Tax) Act 1999.

method A is:

1.

Record the total stock purchases for the sub-entity.

2.

Record the total creditable stock purchases for the sub-entity.

3.

Divide the total creditable stock purchases (2) by the total stock purchases (1) to calculate the percentage of creditable purchases.

4.

Apply this percentage to the total sales made by the sub-entity and then multiply by 1/11th to estimate the GST payable on those sales for the tax period.

method B is:

1.

Record your total stock purchases for the sub-entity for a four-week sample period.

2.

Record your total creditable stock purchases for the sub-entity for the four-week sample period.

3.

Divide the total creditable stock purchases (2) by the total stock purchases (1) to calculate the percentage of creditable purchases.

4.

Apply this percentage to the total stock purchases by the sub-entity to estimate the creditable purchases for each of the tax periods covered by the four-week sample period and then multiply by 1/11th to estimate the input tax credit entitlement on those purchases for each of those tax periods.

5.

Apply the same percentage to the total sales by the sub-entity for each of those tax periods and then multiply by 1/11th to estimate the GST payable on those sales for each of those respective tax periods.

sub-entity of an entity means an organisation that:

(a)

is part of the entity's enterprise(s); and

(b)

is not a separate entity; and

(c)

is not registered; and

(d)

can be separately identified by reference to the nature of the activities carried on through the organisation or the location of the organisation.

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Signed this 31st day of March 2004

Eileen Clancy
Assistant Deputy Commissioner
Goods and Services Tax Program
Delegate of the Commissioner

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Registration Number: F2005B02065

Registration Date: 28 June 2005

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