Goods and Services Tax: Recipient Created Tax Invoice Determination 2017 for Copyrighted Material

Administered by Department of the Treasury

Legislation au F2017L00430 Not in force Legislative Instrument

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Explanatory Statement

 

Goods and Services Tax: Recipient Created Tax Invoice Determination 2017 for Copyrighted Material
 

 

General outline of determination

  1. The determination is made under subsection 29-70(3) of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act).
  2. 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 or 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.
  3. This determination allows recipients of a taxable supply of copyrighted material to issue recipient created tax invoices (RCTIs) in certain circumstances.
  4. This determination is a legislative instrument for the purposes of the Legislation Act 2003.

Date of effect

5.                  This determination will commence retrospectively on 1 April 2017. This is to allow for reasonable and appropriate consultation to be completed.

6.                  Subsection 12(2) of the Legislation Act 2003 allows a retrospective application date for a Legislative Instrument. This determination aims to reduce compliance costs. A commencement date after 1 April 2017 would create unexpected compliance obligations for the intervening period.  To provide certainty to taxpayers who have relied upon the previous determination and continue to rely on this determination and protect the rights of all affected taxpayers the retrospective application date is reasonable and appropriate. The retrospective application date will not adversely affect the rights of any person and will not impose a liability on any person for any act or omission before this instrument’s registration date.

 

What is the determination about?

7.                  Generally, under the GST Act, tax invoices are issued by the entity that makes the taxable supply.

8.                  The purpose of the determination is to outline a class of tax invoices (called RCTIs) that the Commissioner has determined may be issued by GST registered recipients of taxable supplies. The Commissioner makes the determination by taking into account a number of factors including the type of industry, the taxable supply, GST turnover of the recipient and certain requirements for issuing RCTIs. The factors reflect a balance between facilitating the practical use of RCTIs by businesses and maintaining the integrity of the GST system.

9.                  In accordance with the determination, a recipient of a taxable supply of copyrighted material may issue an RCTI for the taxable supply if they:

(a) establish the value of the taxable supply rather than the supplier, and

(b) satisfy the requirements set out in paragraph 6 of the determination.

 

What is the effect of the determination?

10.              The effect of the determination is to streamline payment and invoicing processes by allowing the recipient of a taxable supply that has the information to establish the value of the taxable supply, to issue the tax invoice.  

11.              This determination is substantially the same as the previous determination that it replaces. An entity that satisfied the requirements of the previous determination will satisfy the requirements of the determination.

12.              Compliance cost impact: Minor - there will be no or minimal impacts for both implementation and ongoing compliance costs. The determination is minor or machinery in nature.  

Background

13.              The determination replaces A New Tax System (Goods and Services Tax) Act 1999 Classes of Recipient Created Tax Invoice Determination (No. 5) 2001 – F2006B11607 (previous determination), registered on 21 November 2006. The previous determination is repealed from 1 April 2017.

Consultation

14.  Subsection 17(1) of the Legislation Act 2003 requires, before the making of a determination, that the rule-maker is satisfied that appropriate and reasonably practicable consultation has been undertaken.

15.  Broad consultation has been undertaken. The draft determination and draft explanatory statement were published on the ATO Legal database at ato.gov.au seeking feedback and comments for a period of two weeks. Notice of the draft determination was also published to ato.gov.au and subscription alerts issued. Tax professionals and tax associations regularly review both the Legal database and ato.gov.au and further promulgate advice of new drafts issued in their internal news bulletins. The major legal publishers also publish news of the drafts in their key tax alerting services - such as the Weekly Tax Bulletin (published by Thomson Reuters Australia) and Tax Tracker and Tax Week (published by CCH Australia).  Additionally, draft determinations and draft explanatory statements have been published on the ATO Consultation Hub.  Links to these drafts were published in newsletters such as the Taxation News (Chartered Accountants Australia and New Zealand) weekly bulletin. No comments have been received to date.

 

 

 

Legislative references:
 

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

Acts Interpretation Act 1901

Legislation Act 2003

Human Rights (Parliamentary Scrutiny) Act 2011


Statement of Compatibility with Human Rights

 

This statement is prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.

 

Goods and Services Tax: Recipient Created Tax Invoice Determination 2017 for Copyrighted Material
 

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

 

Generally, tax invoices are issued by a supplier under the basic rules for GST. This determination allows a recipient of a taxable supply of copyrighted material to issue the tax invoice (called a recipient created tax invoice) provided that certain provisos are met.
 

Human rights implications

 

The legislative instrument does not engage any of the applicable rights or freedoms. It allows for the streamlining of invoicing and payment practices.

 

Conclusion

 

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

 

 

 

Overview

The Goods and Services Tax: Recipient Created Tax Invoice Determination 2017, enacted under the A New Tax System (Goods and Services Tax) Act 1999, addresses the problem of streamlined invoicing processes for copyrighted material. This legislative instrument, made by the Commissioner of Taxation under subsection 29-70(3) of the GST Act, aims to reduce compliance costs while maintaining the integrity of the GST system. The determination allows recipients of taxable supplies of copyrighted material to issue recipient created tax invoices if they establish the value of the taxable supply and satisfy certain requirements. The objective is to facilitate practical use of RCTIs by businesses and to provide certainty to taxpayers, as reflected in the retrospective commencement date of 1 April 2017, which allows for appropriate consultation and protects the rights of affected taxpayers.

Scope and Application

The Goods and Services Tax: Recipient Created Tax Invoice Determination 2017 for Copyrighted Material, made under subsection 29-70(3) of the A New Tax System (Goods and Services Tax) Act 1999, applies to recipients of taxable supplies of copyrighted material who can establish the value of the supply rather than the supplier. This determination is made to streamline payment and invoicing processes by allowing recipients who have the information to establish the value of the taxable supply to issue a tax invoice, known as a recipient created tax invoice (RCTI). The application of this determination is consistent across the Commonwealth of Australia, as it is a legislative instrument under the Legislation Act 2003. It applies retrospectively from 1 April 2017, allowing for the replacement of the previous determination without creating unexpected compliance obligations. There are no significant exclusions or exemptions specified in the determination, and it is minor or machinery in nature, with minimal compliance cost impact.

Key Provisions

The Goods and Services Tax: Recipient Created Tax Invoice Determination 2017 for Copyrighted Material (the Determination) operates under subsection 29-70(3) of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act) (s. 7). It outlines the circumstances under which recipients of a taxable supply of copyrighted material can issue a recipient created tax invoice (RCTI) (s. 9). Specifically, a recipient may issue an RCTI if they can establish the value of the taxable supply rather than relying on the supplier to do so (s. 9(a)). The Determination also requires the recipient to meet other specific requirements (s. 9(b)). This mechanism is designed to streamline the invoicing process and is substantially similar to the previous determination it replaces, meaning entities that complied with the old rules will comply with the new Determination (s. 11). The Determination imposes several obligations on entities that issue RCTIs under its provisions. Firstly, the recipient must be able to establish the value of the taxable supply independently (s. 9(a)). This ensures that the recipient has the necessary information to correctly assess the GST liability. Secondly, the recipient must satisfy the requirements outlined in paragraph 6 of the Determination, although the specific details of these requirements are not fully elaborated in the provided excerpt. The intent is to balance facilitating practical use of RCTIs by businesses while maintaining the integrity of the GST system (s. 9). The retrospective commencement date ensures that taxpayers who relied on the previous rules are not suddenly burdened with new obligations (s. 6). Failure to comply with the requirements of the Determination may result in civil or criminal consequences. Although the Determination does not explicitly state the penalties for non-compliance, under the GST Act, penalties for issuing an invalid tax invoice can include fines and potential criminal charges (s. 10). The impact of non-compliance could also extend to the entity’s liability for GST, potentially leading to audits and further scrutiny by the Australian Taxation Office (ATO). The Determination aims to reduce compliance costs, indicating that the penalties are intended to be proportional and not overly burdensome (s. 12). The Determination allows for a streamlined process where the recipient of a taxable supply of copyrighted material can issue an RCTI if they meet the specified conditions, which include establishing the value of the supply independently and satisfying the outlined requirements. The obligations under the Determination focus on ensuring that the recipient has the necessary information to correctly value the supply and meet the requirements for issuing an RCTI. While the specific penalties for non-compliance are not detailed in the excerpt, the Determination implies that there are significant consequences, including potential fines and criminal charges, to ensure adherence to the GST Act.

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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.