A New Tax System (Goods and Services Tax) Act. Australia

      Note: This section is an explanatory section.

      Subdivision 19-A — Adjustment events

      19–10 Adjustment events

      (1) An adjustment event is any event which has the effect of:

      (a) cancelling a supply or acquisition; or

      (b) changing the *consideration for a supply or acquisition; or

      (c) causing a supply or acquisition to become, or stop being, a *taxable supply or *creditable acquisition.

      Example: If goods that are supplied for export are not exported within the time provided in section 38-185, the supply is likely to become a taxable supply after originally being a supply that was GST-free.

      (2) Without limiting subsection (1), these are *adjustment events:

      (a) the return to a supplier of a thing, or part of a thing, supplied (whether or not the return involves a change of ownership of the thing);

      (b) a change to the previously agreed *consideration for a supply or acquisition, whether due to the offer of a discount or otherwise;

      (c) a change in the extent to which an entity that makes an acquisition provides, or is liable to provide, consideration for the acquisition (unless the entity *accounts on a cash basis).

      (3) An *adjustment event:

      (a) can arise in relation to a supply even if it is not a *taxable supply; and

      (b) can arise in relation to an acquisition even if it is not a *creditable acquisition.

      (4) However, the return of a thing supplied, or part of a thing supplied, to its supplier is not an *adjustment event if the return is for the purpose of repair or maintenance.

      Subdivision 19-B — Adjustments for supplies

      19–40 Where adjustments for supplies arise

      You have an adjustment for a supply for which you are liable to pay GST (or would be liable to pay GST if it were a *taxable supply) if:

      (a) in relation to the supply, one or more *adjustment events occur during a tax period; and

      (b) GST on the supply was attributable to an earlier tax period (or, if the supply was not a taxable supply, would have been attributable to an earlier tax period had the supply been a taxable supply); and

      (c) as a result of those adjustment events, the *previously attributed GST amount for the supply (if any) no longer correctly reflects the amount of GST (if any) on the supply (the corrected GST amount), taking into account any change of circumstances that has given rise to an adjustment for the supply under this Subdivision or Division 21 or 134.

      19–45 Previously attributed GST amounts

      The previously attributed GST amount for a supply is:

      (a) the amount of any GST that was attributable to a tax period in respect of the supply; plus

      (b) the sum of any *increasing adjustments, under this Subdivision or Division 21, that were previously attributable to a tax period in respect of the supply; minus

      (c) the sum of any *decreasing adjustments, under this Subdivision or Division 21 or 134, that were previously attributable to a tax period in respect of the supply.

      19–50 Increasing adjustments for supplies

      If the *corrected GSTamount is greater than the *previously attributed GST amount, you have an increasing adjustment equal to the difference between the corrected GST amount and the previously attributed GST amount.

      19–55 Decreasing adjustments for supplies

      If the *corrected GST amount is lessthan the *previously attributed GST amount, you have a decreasing adjustment equal to the difference between the previously attributed GST amount and the corrected GST amount.

      Subdivision 19-C — Adjustments for acquisitions

      19–70 Where adjustments for acquisitions arise

      (1) You have an adjustment for an acquisition for which you are entitled to an input tax credit (or would be entitled to an input tax credit if the acquisition were a *creditable acquisition) if:

      (a) in relation to the acquisition, one or more *adjustment events occur during a tax period; and

      (b) an input tax credit on the acquisition was attributable to an earlier tax period (or, if the acquisition was not a creditable acquisition, would have been attributable to an earlier tax period had the acquisition been a creditable acquisition); and

      (c) as a result of those adjustment events, the *previously attributed input tax credit amount for the acquisition (if any) no longer correctly reflects the amount of the input tax credit (if any) on the acquisition (the corrected input tax credit amount).

      (2) In working out the *corrected input tax credit amount for the acquisition:

      (a) take into account any change of circumstances that has given rise to an adjustment for the acquisition under this Subdivision or Division 21, 129, 133 or 134; and

      (b) if an adjustment relating to the acquisition under Division 131 was attributable to an earlier tax period:

      (i) do not take into account that adjustment; and

      (ii) treat the acquisition as one in relation to which Division 131 had not applied.

      19–75 Previously attributed input tax credit amounts

      The previously attributed input tax credit amount for an acquisition is:

      (a) the amount of any input tax credit that was attributable to a tax period in respect of the acquisition; minus

      (b) the sum of any *increasing adjustments, under this Subdivision or Division 21, 129, 131 or 134, that were previously attributable to a tax period in respect of the acquisition;plus

      (c) the sum of any *decreasing adjustments, under this Subdivision or Division 21, 129 or 133, that were previously attributable