Legal Research
Legislations
Goods and Services Tax: Recipient Created Tax Invoice Determination (No. 37) 2016 for Research Grants

Goods and Services Tax: Recipient Created Tax Invoice Determination (No. 37) 2016 for Research Grants

Administered by Department of the Treasury

Legislation au F2016L01526 Not in force Legislative Instrument

Select Document

Explanatory Statement

General outline of determination

The determination is made under subsection 29-70(3) of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act).
Under subsection 33(3) of the Acts Interpretation Act 1901, where an Act confers a power to make, grant or issue any determination 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 determination.
The determination allows a grantor that is a recipient of a taxable supply of research to issue recipient created tax invoices (RCTIs) if the grantor determines the value of the research grant as set out in the determination.
The determination is a legislative instrument for the purposes of the Legislation Act 2003.

Date of effect

5. The determination commences on the day after registration.

What is the determination about?

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

7. The purpose of the determination is to outline a class of tax invoices (called RCTIs) that the Commissioner has determined may be issued by 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, the 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.

8. In accordance with the determination, a grantor that is a recipient of a taxable supply of research may issue an RCTI for the supply if the grantor:

establishes the value of the research grant before the supply is made using a qualitative, quantitative or other evaluative process; and
satisfies the requirements set out in Clause 7 of the determination.

What is the effect of the determination?

9. The determination allows a grantor, which is a recipient of a taxable supply of research, to issue a RCTI in relation to the supply provided the requirements of the determination are satisfied. As the grantor has the information to establish the value of the taxable supply, issuing RCTIs for such supplies will simplify payment and invoicing processes.

10. The determination is substantially the same as the previous determination that it replaces. Therefore, a grantor who satisfied the previous determination will satisfy the determination and can continue to issue RCTIs under the determination.

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

Background

12. The determination replaces A New Tax System (Goods and Services Tax) Act 1999 Classes of Recipient Created Tax Invoice Determination (No. 6) 2000. The previous determination is repealed on commencement of the determination.

Consultation

13. 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.

14. Broad consultation has occurred. The draft determination and draft explanatory statement were published on the ATO Legal Database at ato.gov.au on 29 June 2016 seeking feedback and comments for a period of two weeks. The ATO Legal Database sends emails and news feeds to direct subscribers such as tax professionals and other industry stakeholders. Consultation on the draft determination and draft explanatory statement was also announced on “What we are consulting about” at ato.gov.au. No comments were received by the due date.

15. Direct consultation was not considered to be necessary because the determination merely preserves a concession that would otherwise be removed as a consequence of the sunsetting of the previous determination.

Legislative references:

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

Acts Interpretation Act 1901

Legislation Act 2003

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 (No. 37) 2016 for Research Grants

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 Legislative Instrument allows a grantor that is the recipient of a taxable supply of research to issue the tax invoice (called recipient created tax invoice) if the grantor determines the value of the research grant in the manner set out under the Legislative Instrument and all other requirements of the Instrument are satisfied. This will simplify both the invoicing and payment processes for the grantor and the supplier.

Human rights implications

This Instrument does not engage any of the applicable rights or freedoms. It allows for the streamlining of invoicing and payment practices.

Conclusion

This 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 (No. 37) 2016 was enacted to address a specific gap in the A New Tax System (Goods and Services Tax) Act 1999 (GST Act) concerning the issuance of tax invoices by recipients of taxable supplies, particularly in the context of research grants. This determination was introduced by the Commissioner of Taxation under the authority of the GST Act and aims to facilitate the practical use of recipient created tax invoices (RCTIs) by businesses while maintaining the integrity of the GST system. The determination allows a grantor, who is the recipient of a taxable supply of research, to issue an RCTI provided the value of the research grant is established before the supply is made and all other specified requirements are met. The objective of this legislative instrument is to streamline the invoicing and payment processes, ensuring that the determination imposes minimal compliance costs. The determination was subject to consultation and is deemed compatible with human rights as it does not engage any applicable rights or freedoms.

Scope and Application

The Goods and Services Tax: Recipient Created Tax Invoice Determination (No. 37) 2016 for Research Grants applies to grantors who are recipients of a taxable supply of research, enabling them to issue recipient created tax invoices (RCTIs) if they determine the value of the research grant in accordance with the requirements of the determination. The determination is made under the A New Tax System (Goods and Services Tax) Act 1999 and operates within the Commonwealth of Australia, thereby applying nationally. It replaces the previous determination, A New Tax System (Goods and Services Tax) Act 1999 Classes of Recipient Created Tax Invoice Determination (No. 6) 2000, which is repealed upon the commencement of this new determination. The effect of this determination is to allow the grantor to issue an RCTI if the value of the research grant is established before the supply is made and if the grantor satisfies the specific requirements outlined in the determination. This facilitates simplified payment and invoicing processes, particularly beneficial in the context of research grants. The determination does not impose significant compliance costs and is minor or machinery in nature. There are no exclusions or exemptions specified in the determination itself, though its application is contingent on meeting the outlined criteria.

Key Provisions

The main operative sections of the Goods and Services Tax: Recipient Created Tax Invoice Determination (No. 37) 2016 for Research Grants (the Determination) are contained in Clauses 7 to 11, which outline the criteria and processes for issuing recipient created tax invoices (RCTIs) by grantors who are recipients of a taxable supply of research. Specifically, Clause 7 details the process for establishing the value of the research grant, while Clauses 8 to 11 describe the effect of the Determination, including its compatibility with human rights. The Determination commences on the day after registration, as per Clause 5, and it replaces the A New Tax System (Goods and Services Tax) Act 1999 Classes of Recipient Created Tax Invoice Determination (No. 6) 2000, which is repealed upon the commencement of the new Determination, as per Clause 12. The Determination imposes obligations on grantors who are recipients of a taxable supply of research to issue RCTIs under certain conditions. These conditions include establishing the value of the research grant before the supply is made, using a qualitative, quantitative or other evaluative process, and satisfying the requirements set out in Clause 7. The Determination also requires grantors to ensure that the RCTI is issued in accordance with the rules set out in the A New Tax System (Goods and Services Tax) Act 1999, including the requirement to include certain details on the RCTI, such as the date of issue, the supplier's and recipient's names and addresses, a description of the supply, and the value of the supply. Additionally, the Determination requires grantors to keep records of the RCTIs issued and to provide these records to the Commissioner of Taxation upon request. Breach of the Determination may result in civil or criminal consequences, depending on the nature and severity of the breach. Under the A New Tax System (Goods and Services Tax) Act 1999, the Commissioner of Taxation may issue a notice of contravention to a person who contravenes a provision of the Act, which may result in a penalty of up to $2,100 for individuals and $10,500 for companies. Additionally, under the Legislation Act 2003, the Commissioner may refer a matter to the Commonwealth Director of Public Prosecutions if the breach is considered to be a serious offence, which may result in criminal charges and penalties of up to $210,000 for individuals and $1,050,000 for companies. However, the Determination itself does not specify any particular offences, penalties, or consequences for breach. Instead, it relies on the provisions of the A New Tax System (Goods and Services Tax) Act 1999 and the Legislation Act 2003 to address such matters.

Area of Law: Taxation Law
Instrument: Regulation
Concepts: Definitions & Interpretation; Compliance Obligations; Consultation Requirements
Catchwords: Registrant Created Tax Invoice

Interactions

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.

Legislation content