A New Tax System (Goods and Services Tax): Waiver of Tax Invoice Requirement (Acquisitions by Recipients Using Electronic Purchasing Systems) Determination 2023

Administered by Department of the Treasury

Legislation au F2023L00330 In force Legislative Instrument

Legislation content

Explanatory Statement

A New Tax System (Goods and Services Tax): Waiver of Tax Invoice Requirement (Acquisitions by Recipients Using Electronic Purchasing Systems) Determination 2023

 

General outline of determination

  1. This determination is made under subsection 29-10(3) of the A New Tax System (Goods and Services Tax) Act 1999 (the Act).
  2. This determination waives the requirement for a recipient making a creditable acquisition using electronic purchasing systems to hold a tax invoice when they hold a document that meets the requirements prescribed in this determination.
  3. This determination replaces A New Tax System (Goods and Services Tax) Waiver of Tax Invoice Requirement (Acquisitions by Recipients Using Electronic Purchasing Systems) Legislative Instrument 2013.
  4. The determination is a legislative instrument for the purposes of the Legislation Act 2003.
  5. Under subsection 33(3) of the Acts Interpretation Act 1901, where an Act confers a power to make, grant or issue any instrument of a legislative or administrative character (including rules, regulations and by-laws) the power shall be construed as including a power exercisable in the like manner and subject to the like conditions (if any) to repeal, rescind, revoke, amend, or vary any such instrument.

 

Date of effect

6.                  This determination commences on the day after it is registered on the Federal Register of Legislation.

 

Effect of this determination

7.                  This determination applies to a recipient making a creditable acquisition when that acquisition is made through an electronic purchasing system.

8.                  This determination waives the requirement for a recipient to hold a tax invoice for a creditable acquisition, when the recipient holds documents relating to an electronic purchasing system that together meet the requirements of this determination.

 

Compliance cost assessment

9.                  Compliance cost impact: Minor – There will be no additional impacts as the instruments are minor and machinery in nature OBPR22-03758.

 

Background

10.              Generally, when a recipient makes a creditable acquisition, an input tax credit for the acquisition is not attributable to a tax period until they hold a tax invoice. A tax invoice is a document that meets the requirements in subsection 29‑70(1) of the Act.

11.              A supplier is required to issue a tax invoice, unless it is a recipient created tax invoice issued by a recipient under subsection 29-70(3) of the Act. A recipient created tax invoice must comply with the requirements in subsection 29-70(1) of the Act.

12.              In some cases, the necessity for the recipient to hold a document that meets the requirements in subsection 29-70(1) of the Act may impose a disproportionate burden on a supplier or recipient, particularly if the document that they hold has most of the required features of a tax invoice.

13.              An electronic purchasing system allows a recipient to make creditable acquisitions, arrange and record supplies, and issue documents that are intended to be recipient created tax invoices. These systems may create a document that complies with the requirements for a tax invoice, apart from the requirement to be able to clearly ascertain what is supplied, including the quantity (if applicable) and the price of what is supplied, but refer to another document from which this information could be obtained (such as a purchase order).

14.              These systems produce a summary document of the taxable supplies acquired from a supplier that satisfies the requirements of subsection 29-70(1) of the Act, other than the requirement in subparagraph 29-70(1)(c)(iii).

15.              As a result, a summary document produced by an electronic purchasing system and issued by a recipient would not satisfy the requirements of subsection 29-70(1) of the Act. An input tax credit for a creditable acquisition would therefore not be attributable to a tax period until the recipient held a document that complied with the requirements for a tax invoice.

16.              However, where a recipient holds another document referred to in the summary document (such as a purchase order), and those documents together meet the requirements in paragraph 29-70(1)(c) of the Act, this instrument would relieve the recipient of the obligation to hold a tax invoice.

17.              The Commissioner has a discretion under 29-70(1B) of the Act to treat a document as a tax invoice where not all the requirements in subsection 29‑70(1) of the Act are met. However, the Commissioner’s discretion under subsection 29-70(1B) of the Act is administrative and can only be exercised on a case-by-case basis.

18.              As such, the Commissioner makes this determination under subsection 29‑10(3) of the Act to ensure that taxpayers do not have to change their administrative practices formed in reliance on past legislative instruments and rulings that are now either withdrawn or repealed.

 

Consultation

19.              Subsection 17(1) of the Legislation Act 2003 requires that the Commissioner be satisfied that appropriate and reasonably practicable consultation has been undertaken before he makes a determination.

20.              Public consultation was undertaken on this instrument for a period of 3 weeks from 25 November 2022 to 16 December 2022 inclusive.

21.              The draft instrument and draft explanatory statement were published on the ATO Legal database, which is publicly available. Publication was advertised via the 'What's new' page on that website, and via the 'Open Consultation' page on ato.gov.au. Major tax and superannuation publishers and associations monitor these pages and include the details in the daily and weekly alerts and newsletters that they provide to their subscribers and members.

22.              No comments were received as part of the consultation process.

 

 

 

Legislative references

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

Acts Interpretation Act 1901

Human Rights (Parliamentary Scrutiny) Act 2011

Legislation Act 2003

Statement of Compatibility with Human Rights

Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011

 

A New Tax System (Goods and Services Tax): Waiver of Tax Invoice Requirement (Acquisitions by Recipients Using Electronic Purchasing Systems) Determination 2023

This legislative instrument is compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.

 

Overview of the legislative instrument

A taxpayer must generally hold a tax invoice to be able to claim an input tax credit under the A New Tax System (Goods and Services Tax) Act 1999 (the Act). A tax invoice is a document that meets certain requirements under the Act. This determination waives the requirement under the Act to hold a tax invoice before an input tax credit can be claimed in a tax period. This waiver will only apply if the conditions set out in the determination are met. The purpose of this waiver is to reduce the compliance burden for recipients and suppliers.

 

Human rights implications

This legislative instrument does not engage any of the applicable rights or freedoms because it merely waives the requirement to hold a tax invoice in certain circumstances, and replaces it with a requirement to hold a different document or documents that meet alternative conditions.

 

Conclusion

The legislative instrument is compatible with human rights as it does not raise any human rights issues.

Overview

The A New Tax System (Goods and Services Tax): Waiver of Tax Invoice Requirement (Acquisitions by Recipients Using Electronic Purchasing Systems) Determination 2023 was enacted to address the administrative burden associated with obtaining tax invoices for creditable acquisitions made through electronic purchasing systems. This legislative instrument, made under subsection 29-10(3) of the A New Tax System (Goods and Services Tax) Act 1999, replaces the previous legislative instrument from 2013. It was developed in consultation with major tax and superannuation publishers and associations, although no comments were received during the consultation period. The objective of this determination is to ensure taxpayers can continue to rely on existing administrative practices without needing to change their procedures. It aims to reduce the compliance burden by allowing recipients to claim input tax credits using documents that meet the prescribed requirements in the determination, rather than requiring a traditional tax invoice.

Scope and Application

The A New Tax System (Goods and Services Tax): Waiver of Tax Invoice Requirement (Acquisitions by Recipients Using Electronic Purchasing Systems) Determination 2023 applies to recipients making creditable acquisitions through electronic purchasing systems. This waiver of the tax invoice requirement is applicable when the recipient holds documents relating to the electronic purchasing system that together meet the requirements specified in this determination. It is important to note that the waiver applies only to creditable acquisitions made via electronic purchasing systems, and not to other types of acquisitions or transactions. This determination ensures that taxpayers are not required to alter their administrative practices that were based on previous legislative instruments and rulings now withdrawn or repealed. The geographic reach of this determination is national, as it is a Commonwealth legislative instrument. The determination does not include any specific exclusions, exemptions, or thresholds, but rather provides a set of conditions that must be met for the waiver to apply. Additionally, this determination may be amended or extended through subordinate instruments, as allowed under the Legislation Act 2003.

Key Provisions

The main operative sections of this determination, particularly section 7, waive the requirement for a recipient to hold a tax invoice for a creditable acquisition, provided that the recipient holds documents relating to an electronic purchasing system that together meet the prescribed requirements. This waiver applies specifically to creditable acquisitions made through electronic purchasing systems, as outlined in section 8. This legislative instrument is made under subsection 29-10(3) of the A New Tax System (Goods and Services Tax) Act 1999, and it aims to ensure that taxpayers do not need to change their administrative practices that were formed in reliance on past legislative instruments and rulings. The obligations imposed on parties governed by this Act primarily concern the documentation requirements for creditable acquisitions. Recipients making such acquisitions through electronic purchasing systems must ensure that they hold documents that meet the conditions set out in the determination. These documents must be such that they, when taken together, satisfy the requirements for a tax invoice under subsection 29-70(1) of the Act, except for the specific requirement to clearly ascertain the supplied goods or services, their quantity, and their price. Instead, these documents can refer to another document from which such information can be obtained, such as a purchase order. Under this determination, there are no explicit offences or penalties stated for breaches of the requirements. However, if a recipient does not comply with the conditions set out in the determination, they may not be able to claim an input tax credit for the acquisition until they hold a document that meets the requirements for a tax invoice. This could result in a financial impact for the recipient, as they would be unable to offset the cost of the acquisition against their taxable supplies. Additionally, failure to comply with the requirements may lead to scrutiny or investigation by the Australian Taxation Office, which could result in further administrative or financial consequences.

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Sourced from the Federal Register of Legislation at 26 August 2026. For the latest information on Australian Government law please go to https://www.legislation.gov.au.