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Goods and Services Tax: Waiver of Adjustment Note Requirement Determination 2017 – for Decreasing Adjustments from Intangible Supplies from Offshore

Goods and Services Tax: Waiver of Adjustment Note Requirement Determination 2017 – for Decreasing Adjustments from Intangible Supplies from Offshore

Administered by Department of the Treasury

Legislation au F2017L00420 In force Legislative Instrument

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Explanatory Statement

Goods and Services Tax: Waiver of Adjustment Note Requirement Determination 2017– for Decreasing Adjustments from Intangible Supplies from Offshore

General outline of determination

This determination is made under subsection 29-20(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.
This determination waives the requirement to hold an adjustment note in order to attribute a decreasing adjustment to a tax period where the decreasing adjustment arises from an adjustment event that relates to an intangible supply from offshore that is a taxable supply under section 84-5 of the GST Act.
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 will allow 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. Under subsection 29-20(3) of the GST Act, you can only attribute a decreasing adjustment from an adjustment event in the first tax period when you hold an adjustment note for the adjustment (unless the adjustment is $75 or less).

8. However, the Commissioner may determine in writing, the circumstances under which the requirement for an adjustment note for a decreasing adjustment does not apply.

9. This determination waives the requirement to hold an adjustment note for a decreasing adjustment where an entity has a decreasing adjustment that arises from an adjustment event that relates to an intangible supply from offshore that is a taxable supply under section 84-5 of the GST Act.

What is the effect of the determination?

10. At the time of lodging a GST return, an entity with a decreasing adjustment arising from an adjustment event that relates to an intangible supply from offshore that is a taxable supply under section 84-5 of the GST Act can attribute the decreasing adjustment without holding an adjustment note.

11. This determination overcomes the practical difficulties that a recipient faces in obtaining an adjustment note for an adjustment that arises from an adjustment event that relates to an intangible supply from offshore that is a taxable supply under section 84-5 of the GST Act.

12. 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 this determination.

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

Background

14. This determination replaces A New Tax System (Goods and Services Tax) Waiver of Requirement to hold an Adjustment Note for a decreasing Adjustment Determination 2000 - F2006B11575, registered on 14 November 2006 (previous determination). The previous determination is repealed from 1 April 2017.

Consultation

15. 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.

16. 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: Waiver of Adjustment Note Requirement Determination 2017 – for decreasing adjustments from intangible supplies from offshore

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

Adjustment notes are generally issued by a supplier under the basic rules for GST. The legislative instrument allows an entity that has a decreasing adjustment relating to an intangible supply from a non-resident supplier to attribute any decreasing adjustments without holding an adjustment note provided that certain conditions are met.

Human rights implications

The legislative instrument does not engage any of the applicable rights or freedoms. It allows for the attribution of decreasing adjustments without holding an adjustment note.

Conclusion

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

Overview

The Goods and Services Tax: Waiver of Adjustment Note Requirement Determination 2017, enacted under subsection 29-20(3) of the A New Tax System (Goods and Services Tax) Act 1999, aims to address the practical difficulties faced by entities in obtaining adjustment notes for decreasing adjustments from intangible supplies from offshore. This determination, made by the Commissioner of Taxation, waives the requirement for entities to hold an adjustment note when attributing a decreasing adjustment from such supplies. It was introduced to provide certainty and reduce compliance costs for taxpayers, particularly in cases where obtaining an adjustment note from offshore suppliers is challenging. The determination commenced retrospectively on 1 April 2017, allowing for appropriate consultation and ensuring that taxpayers who have relied on the previous determination continue to benefit without unexpected compliance obligations. The determination is consistent with the Human Rights (Parliamentary Scrutiny) Act 2011, as it does not engage any applicable rights or freedoms.

Scope and Application

The Goods and Services Tax: Waiver of Adjustment Note Requirement Determination 2017 applies to entities subject to the A New Tax System (Goods and Services Tax) Act 1999 (GST Act) who have a decreasing adjustment that arises from an adjustment event relating to an intangible supply from offshore that is a taxable supply under section 84-5 of the GST Act. This determination waives the requirement for an entity to hold an adjustment note to attribute a decreasing adjustment to a tax period where the adjustment arises from such offshore intangible supplies. The scope of this determination is limited to reducing compliance costs by allowing entities to attribute decreasing adjustments without holding an adjustment note, thereby addressing practical difficulties in obtaining adjustment notes for offshore intangible supplies. The determination applies across Australia as it is a Commonwealth instrument. There are no stated exclusions or exemptions within the determination itself, but the application is restricted to specific circumstances as outlined. The retrospective commencement date of 1 April 2017 ensures that taxpayers who have relied on the previous determination are not adversely affected and provides certainty. The compatibility statement confirms that this legislative instrument does not engage any of the applicable rights or freedoms under the Human Rights (Parliamentary Scrutiny) Act 2011.

Key Provisions

The main operative sections of the Goods and Services Tax: Waiver of Adjustment Note Requirement Determination 2017 (F2017L00420) are subsections 29-20(3) and 33 of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act). This determination waives the requirement to hold an adjustment note for a decreasing adjustment that arises from an adjustment event related to an intangible supply from offshore that is a taxable supply under section 84-5 of the GST Act. Entities can now attribute such decreasing adjustments without holding an adjustment note, which alleviates practical difficulties in obtaining adjustment notes for offshore intangible supplies. The obligations imposed by this determination on entities include the ability to attribute decreasing adjustments without holding an adjustment note, provided the adjustments arise from adjustment events relating to offshore intangible supplies. This is contingent on the entity ensuring that the supply meets the criteria of being a taxable supply under section 84-5 of the GST Act. Entities must also ensure that they comply with the provisions of the determination and other relevant sections of the GST Act to avoid any discrepancies in their tax reporting. Breaching the conditions of this determination could lead to non-compliance with the GST Act. While the explanatory statement does not specify explicit offences, penalties, or consequences for breach, non-compliance generally could result in administrative penalties, interest on unpaid tax, and potential audits by the Australian Taxation Office (ATO). The ATO may also require entities to rectify their records and file amended returns, which could involve additional administrative burdens and costs. It is essential for entities to adhere to the requirements of this determination to avoid these potential repercussions.

Area of Law: Taxation Law
Instrument: Legislative Instrument
Concepts: Commencement Provisions; Definitions & Interpretation; Repeal & Amendment; Compliance Obligations; Taxation of Goods and Services

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.

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