Issue
Is an entity, which is registered for goods and services tax (GST), required to hold a tax invoice at the time it claims a fuel tax credit in respect of taxable fuel pursuant to subsection 65-5(1) of the Fuel Tax Act 2006 (FTA).
Decision
Yes, an entity, which is registered for GST, is required to hold a tax invoice at the time it claims a fuel tax credit in respect of taxable fuel pursuant to subsection 65-5(1) of the FTA.
Facts
An entity is registered for GST and accounts for GST monthly on a non-cash basis.
The entity acquired fuel for use in carrying on its enterprise.
The entity made a creditable acquisition under section 11-5 of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act). The entity is entitled to an input tax credit on the fuel under section 11-20 of the GST Act.
The entity is entitled to a fuel tax credit in respect of the acquisition of the fuel under section 41-5 of the FTA.
The entity paid for the fuel and received an invoice in the month in which it acquired the fuel.
The invoice did not satisfy the requirements for a tax invoice under section 29-70 of the GST Act.
The entity received a tax invoice after it had lodged its business activity statement for the month (tax period) in which it acquired the fuel.
Reasons for Decision
Division 65 of the FTA sets out the attribution rules for fuel tax credits and fuel tax adjustments.
Subsection 65-5(1) of the FTA provides that a fuel tax credit is attributable to the same tax period to which the input tax credit for the fuel is attributable under the GST Act. This means that the timing of the attribution of a fuel tax credit is subject to the same attribution rules that exist for GST.
Subsection 29-10(1) of the GST Act provides that the input tax credit for a creditable acquisition made by an entity that accounts for GST on a non-cash basis is attributable to either: • the tax period in which any of the consideration is provided, or • the tax period, if before any of the consideration is received, an invoice is issued relating to the supply.
The entity paid for the fuel and received an invoice (not a tax invoice) in the month it acquired the fuel. Therefore, under paragraph 29-10(1)(a) of the GST Act, the input tax credit would be attributable to that month (tax period).
However, subsection 29-10(3) of the GST Act delays attribution of input tax credits to the tax period in which an entity holds a tax invoice for a creditable acquisition. Subsection 29-10(3) of the GST Act provides that the input tax credit is not attributable to the tax period that would otherwise apply under paragraph 29-10(1)(a) of the GST Act, and is attributable to the first tax period for which the entity gives the Commissioner a GST return at a time when it holds the relevant tax invoice. The entity should attribute the input tax credit to the tax period in which it holds the relevant tax invoice - the month after it acquired the fuel.
As subsection 65-5(1) of the FTA provides that a fuel tax credit is attributable to the same tax period to which the input tax credit is attributable under the GST Act, it follows that the entity's fuel tax credit is attributable to the tax period in which it holds the relevant a tax invoice. Note: Subsection 65-5(4) of the FTA provides that if an entity's return does not take into account a fuel tax credit that is attributable to the tax period under subsections 65-5(1), 65-5(2) or 65-5(3) of the FTA, then the credit ceases to be attributable to that period and becomes attributable to the first period for which the entity gives the Commissioner a return that does take it into account.