GST - Shared tax invoices

Sections 2(1) and 24BA of the Goods and Services Act 1985

Changes have been made to the Goods and Services Tax Act 1985 to allow, in certain circumstances, two or more suppliers to invoice a customer using one tax invoice. The change is intended to simplify the way in which suppliers are required to invoice customers for bundled supplies of goods and services for GST purposes

Background

A tax invoice is a document that contains the required details set out in the GST Act. These requirements generally include the name and address of the supplier and their GST registration number in addition to a description of the goods and services sold, the name and address of the recipient and the date the invoice is issued.

A situation may arise where two GST-registered persons, Supplier A and Supplier B, provide goods and services to the same customer, although Supplier B is the only supplier with whom the customer has actual communication. Before the amendment, the GST Act did not clearly contemplate a single invoice for these types of transactions.

To simplify the invoice issuing requirements, amendments have been made to the GST Act to allow members of the same GST group or parties to arrangements created by statute to use "shared" tax invoices.

Key features

The GST Act has been amended by inserting new section 24BA to allow a single shared tax invoice to be issued by one principal supplier on his or her own behalf and on behalf of other GST-registered suppliers.

Section 24BA specifies that shared invoices can be issued in two situations:

• when suppliers have statutory obligations which make it practical to use a single invoice (for example, a levy imposed by statute); or
• when suppliers are part of the same GST group of companies.

Section 24BA also specifies what information should be contained on a shared tax invoice for it to be considered a valid tax invoice. This information is similar to the current requirements of a standard tax invoice.

Section 2, the definition section of the GST Act, has also been amended to include the new section 24BA in the definition of "tax invoice".

Application date

The amendments apply from 19 December 2007.