This GST Determination, released on Wed 1.8.2012, states that when an entity acquires second-hand goods and makes a subsequent taxable supply of the goods by way of a lease (before making a taxable supply of the goods by way of sale or exchange), both taxable supplies are taken into account in quantifying and attributing input tax credits under ss 66-10(1) and 66-15(1) of the GST Act.
In these circumstances, the Determination states generally that the amount of input tax credits under s 66-10(1) will be an amount equal to 1/11th of the consideration the entity provided. In addition, the Determination broadly states that under s 66-15(1) the input tax credit is attributed to the tax period in which any consideration is received for the supply.
The Determination includes an example of a creditable acquisition of a second-hand vehicle that is leased before being sold to illustrate the quantification and attribution of the input tax credit.
DATE OF EFFECT: Applies both before and after its date of issue.
[LTN 147, 1/8]