The Commissioner of Taxation, Chris Jordan, gives notice of the following Rulings, copies of which can be obtained from ato.gov.au/law.
NOTICE OF RULINGS |
Ruling number | Subject | Brief description |
GSTR 2020/1 | Goods and services tax: determining the creditable purpose of acquisitions in relation to transaction accounts | This Ruling provides advice on determining whether an account provider is entitled to GST credits for common acquisitions they make to provide transaction accounts (such as savings and deposit accounts, as well as everyday transaction accounts) when the provider also makes taxable supplies of interchange services. This Ruling applies from 1 October 2020. |
GSTD 2020/1 | Goods and services tax: when is the supply of a transaction account GST-free under table item 3 or table item 4(a) of subsection 38-190(1) of the A New Tax System (Goods and Services) Tax Act 1999? | This Determination provides advice on the extent to which the supply of a transaction account is GST-free where the account can be used outside of Australia. This Determination applies from 1 October 2020. |
CR 2020/52 | Zenith Energy Limited – scheme of arrangement and special dividend | This Ruling sets out the income tax consequences for Zenith Energy Limited shareholders who participated in the scheme of arrangement announced on 6 March 2020 and received the special dividend paid on 21 August 2020. This Ruling applies from 1 July 2020 to 30 June 2021. |
CR 2020/53 | Griffith University – early retirement scheme 2020 | This Ruling sets out the tax consequences for Griffith University employees who receive a payment under the 2020 early retirement scheme. This Ruling applies from 1 October 2020 to 24 December 2020. |
NOTICE OF ADDENDUM |
Ruling number | Subject | Brief description |
GSTR 2004/4 | Goods and services tax: assignment of payment streams including under a typical securitisation arrangement | This Addendum clarifies when input tax credits are available to home loan lenders where securitisation arrangements exist. This Addendum applies on and from 25 September 2020. |
Overview
The Commissioner of Taxation has issued several rulings and an addendum to clarify various aspects of tax law, particularly in relation to the Goods and Services Tax (GST) and income tax. The A New Tax System (Goods and Services) Tax Act 1999, enacted in 1999, was introduced to establish a comprehensive GST system in Australia, aiming to replace a variety of indirect taxes with a single GST. The rulings and addendum issued by the Commissioner seek to provide specific guidance on complex tax issues, ensuring taxpayers can correctly apply the law. For instance, GSTR 2020/1 addresses the creditable purpose of acquisitions for transaction accounts and GST-free supplies, while CR 2020/52 and CR 2020/53 deal with the tax implications of specific corporate arrangements. GSTR 2004/4, as an addendum, clarifies the availability of input tax credits in securitisation arrangements. These notices are essential for taxpayers and tax practitioners to navigate the intricacies of current tax legislation and ensure compliance.
Scope and Application
The Commissioner of Taxation has issued several rulings and determinations that are relevant to various stakeholders, including account providers, energy companies, universities, and home loan lenders. GSTR 2020/1 addresses the eligibility of account providers to claim GST credits on certain acquisitions related to transaction accounts, effective from 1 October 2020. GSTD 2020/1 focuses on the GST-free status of supplies of transaction accounts that can be used outside Australia, also applying from 1 October 2020. CR 2020/52 outlines the income tax implications for Zenith Energy Limited shareholders involved in a scheme of arrangement and special dividend distribution, applicable from 1 July 2020 to 30 June 2021. CR 2020/53 details the tax consequences for Griffith University employees participating in an early retirement scheme, effective from 1 October 2020 to 24 December 2020. Additionally, GSTR 2004/4 Addendum provides clarification on input tax credits for home loan lenders involved in securitisation arrangements, applicable from 25 September 2020. These rulings and determinations provide essential guidance on tax obligations and entitlements for the specified entities and activities within the Australian jurisdiction.
Key Provisions
The Commissioner of Taxation has issued several rulings and an addendum to provide clarification on various aspects of Australian taxation law. GSTR 2020/1 (paragraph 1) addresses the determination of the creditable purpose of acquisitions in relation to transaction accounts, specifically when account providers are entitled to GST credits for certain acquisitions made to provide accounts such as savings and deposit accounts. This Ruling is effective from 1 October 2020. GSTD 2020/1 (paragraph 2) offers guidance on when the supply of a transaction account is GST-free under specific table items, focusing on accounts that can be used outside Australia, and applies from the same date. CR 2020/52 (paragraph 3) deals with the income tax implications for Zenith Energy Limited shareholders who participated in a scheme of arrangement and received a special dividend, effective from 1 July 2020 to 30 June 2021. CR 2020/53 (paragraph 4) outlines the tax consequences for Griffith University employees receiving a payment under the 2020 early retirement scheme, applicable from 1 October 2020 to 24 December 2020. An addendum to GSTR 2004/4 (paragraph 5) further clarifies the availability of input tax credits to home loan lenders in securitisation arrangements, taking effect from 25 September 2020.
The obligations imposed by these rulings and the addendum primarily involve compliance with the specific tax laws and regulations they address. For instance, GSTR 2020/1 and GSTD 2020/1 require account providers to ensure their acquisitions and supplies align with the guidance provided to claim the appropriate GST credits or exemptions. CR 2020/52 and CR 2020/53 necessitate that Zenith Energy Limited shareholders and Griffith University employees accurately report their income tax liabilities in accordance with the specified tax consequences. The Addendum to GSTR 2004/4 imposes the requirement on home loan lenders to correctly apply the input tax credit provisions when engaging in securitisation arrangements. These obligations ensure taxpayers are informed and compliant with the latest tax rulings and determinations.
Breach of the obligations under these rulings and the addendum could result in various consequences. The primary consequence is the potential loss of GST credits or GST-free status, which could lead to additional tax liabilities for the affected parties. For instance, account providers failing to adhere to GSTR 2020/1 and GSTD 2020/1 may be liable for additional GST on their taxable supplies or be unable to claim credits on their acquisitions. Similarly, non-compliance with CR 2020/52 and CR 2020/53 could result in Zenith Energy Limited shareholders and Griffith University employees facing additional income tax liabilities. The Addendum to GSTR 2004/4 could result in home loan lenders being liable for GST on amounts that should have been credited. While the specific penalties are not detailed in the notice, breaches of tax law generally can lead to fines, interest on unpaid taxes, and potential legal action by the Australian Taxation Office.