Goods and Services Tax: Waiver of Adjustment Note Requirement Determination 2017 – Members of MasterCard International and Visa International – Bank Interchange Transfers

Administered by Department of the Treasury

Legislation au F2017L00426 In force Legislative Instrument

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Explanatory Statement

 

Goods and Services Tax: Waiver of Adjustment Note Determination 2017 – Members of Mastercard International and Visa International – Bank Interchange Transfers

 

General outline of determination

  1. This determination is made under subsection 29-20(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 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 instrument.
  3. This determination waives the requirement for a member to hold an adjustment note to attribute a decreasing adjustment to a tax period 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.        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 in which you do not require an adjustment note in order to attribute a decreasing adjustment.

9.      This determination waives the requirement to hold an adjustment note for a decreasing adjustment that relates to the acquisition of bank interchange services where details of the adjustment are detailed on a bank interchange services report that satisfies the information requirements in subparagraph 6(2) of this determination.
 

What is the effect of the determination?

10.  This determination provides that a member that has a decreasing adjustment relating to the acquisition of bank interchange services can attribute the decreasing adjustment without holding an adjustment note.

11.  This determination overcomes the practical difficulties that a member faces in obtaining an adjustment note that relates to the acquisition of bank interchange services.

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 impacts 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) Act 1999 Waiver to hold a Adjustment Note for a Decreasing Adjustment Determination 2000 – MEMBERS of MASTERCARD INTERNATIONAL and VISA INTERNATIONAL – F2006B11621 (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 1999Acts 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 – Members of MasterCard International and Visa International – Bank Interchange Transfers

 

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 Determination


Adjustment notes are generally issued by the supplier under the basic rules for GST. This  determination waives the requirement in subsection 29-20(3) of the A New Tax System (Goods and Services Tax) Act 1999for members to hold an adjustment note before a decreasing adjustment is allowed to be attributable to a tax period where details of the adjustment are contained in a bank interchange services report, 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 a member to attribute a decreasing adjustment without holding an adjustment note in certain circumstances.


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 Determination 2017 was enacted to address the practical difficulties faced by members of Mastercard International and Visa International in obtaining adjustment notes for decreasing adjustments relating to the acquisition of bank interchange services. This determination, made under subsection 29-20(3) of the A New Tax System (Goods and Services Tax) Act 1999, waives the requirement for members to hold an adjustment note to attribute a decreasing adjustment to a tax period, provided that the adjustment details are detailed on a bank interchange services report that satisfies specific information requirements. This change is intended to reduce compliance costs and provide certainty to taxpayers who have relied upon previous determinations. The determination was introduced by the Parliament of Australia and aims to streamline the process for attributing adjustments, thereby ensuring compliance with GST regulations in a more efficient manner.

Scope and Application

The Goods and Services Tax: Waiver of Adjustment Note Determination 2017 applies to members of Mastercard International and Visa International, specifically in relation to bank interchange transfers. It is made under subsection 29-20(3) of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act). The determination waives the requirement for members to hold an adjustment note to attribute a decreasing adjustment to a tax period when the details of the adjustment are detailed in a bank interchange services report that satisfies certain information requirements. This waiver is aimed at reducing compliance costs and addressing practical difficulties faced by members in obtaining adjustment notes for bank interchange services. The retrospective commencement date of 1 April 2017 ensures that the determination provides certainty to taxpayers who have relied upon the previous determination. It applies nationally and does not adversely affect the rights of any person or impose liability for any act or omission before the determination's registration date.

Key Provisions

The primary operative sections of this determination (subsection 29-20(3) of the A New Tax System (Goods and Services Tax) Act 1999) allow the Commissioner to waive the requirement for members to hold an adjustment note in specific circumstances. The key provision here (section 9) waives the requirement for a member to hold an adjustment note for a decreasing adjustment related to the acquisition of bank interchange services, provided that the adjustment details are detailed on a bank interchange services report that meets the information requirements specified in the determination (subsection 6(2)). The obligations and requirements imposed by this determination (section 10) mandate that members who have a decreasing adjustment related to the acquisition of bank interchange services can attribute the adjustment without holding an adjustment note. The determination also ensures that these members must ensure that the details of the adjustment are correctly detailed on a bank interchange services report that satisfies the specified information requirements (subsection 6(2)). As for the consequences of non-compliance, the determination itself does not explicitly outline specific offences, penalties, or civil or criminal consequences for breach. However, the overarching legislation under which this determination is made, the A New Tax System (Goods and Services Tax) Act 1999, does provide for penalties in case of non-compliance. Generally, penalties for GST non-compliance can include fines, imprisonment, or both. For example, under section 28-5 of the GST Act, a person who contravenes the Act may be liable for a penalty of up to $22,200 or 500 penalty units, or both, for each offence, depending on the nature and severity of the contravention. These penalties serve to deter non-compliance and ensure adherence to the tax laws.

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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.