Amount of input tax credits relating to employee reimbursements
18 March 2013
The amount of the ITC for a creditable acquisition under section 111-10 of the GST Act is reduced under section 11-30 of the GST Act if the acquisition is partly creditable.
Section 11-30 of the GST Act sets out how an amount of ITC is worked out for an acquisition that is partly creditable. Paragraph 11-30(1)(a) of the GST Act provides that an acquisition is partly creditable if it is made only partly for a 'creditable purpose' as defined in section 11-15 of the GST Act. This definition of 'creditable purpose' is not overridden by Division 111 of the GST Act. Therefore, to the extent that the acquisition for the reimbursement relates to making input taxed supplies, the acquisition is not creditable