GST and the issue of a tax invoice for a compulsory third party motor vehicle insurance payment made prior to 1 July 2003

Is the entity, a motor vehicle insurer, required to issue a tax invoice, under section 29-70 of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act), when it supplies compulsory third party motor vehicle insurance to a customer prior to 1 July 2003 and subsection 23(1A) of the A New Tax System (Goods and Services Tax) Act 1999 (Transition Act) applies?

No, the entity is not required to issue a tax invoice under section 29-70 of the GST Act when it supplies compulsory third party motor vehicle insurance to a customer prior to 1 July 2003 and subsection 23(1A) of the Transition Act applies.

The entity is a motor vehicle insurer. The entity supplies compulsory third party motor vehicle insurance to a customer before 1 July 2003.

The compulsory third party motor vehicle insurance has been levied in connection with a compulsory third party scheme that is a statutory compensation scheme specified in the A New Tax system (Goods and Services Tax Transition) Regulations 2000 (Transition Regulations).

The customer is not entitled to an input tax credit under subsection 23(1) of the A New Tax System (Goods and Services Tax Transition) Act 1999 (Transition Act).

The entity is registered for goods and services tax (GST). The supply of the compulsory third party motor vehicle insurance to the customer is a taxable supply under section 9-5 of the GST Act.

Under subsection 29-70(2) of the GST Act, the supplier of a taxable supply must, within 28 days after the recipient of the supply requests it, give the recipient a tax invoice for the supply.

In this case, the supply of compulsory third party motor vehicle insurance to the customer is a taxable supply under section 9-5 of the GST Act. As such, under subsection 29-70(2) of the GST Act, a tax invoice should be issued to the customer within 28 days after the customer requests it.

However, subsection 23(1A) of the Transition Act provides that if subsection 23(1) of the Transition Act applies and the customer is not entitled to an input tax credit for the acquisition, then section 29-70 of the GST Act does not apply in relation to the supply to which the acquisition relates.

In this case, the customer is not entitled to an input tax credit, under subsection 23(1) of the Transition Act, for a payment of compulsory third party motor vehicle insurance made prior to 1 July 2003. As such, section 29-70 of the GST Act does not apply and the entity is not required to issue a tax invoice when it supplies compulsory third party motor vehicle insurance to a customer prior to 1 July 2003.