on that supply? The legislation that has been enacted to provide certainty on various transitional issues applies in these circumstances (see new section 78AA(13) of the GST Act). Provided the original incorrect invoice is cancelled by issuing a credit note that complies with the requirements of section 25 of the GST Act and a replacement invoice is issued to the correct recipient, the replacement invoice can account for GST at the 12.5% rate. Insurance receipts: What happens if my insurance company makes a payment to me that I do not receive until after 1 October? When a GST registered party receives an insurance payout from their insurer in relation to a loss incurred in the course or furtherance of their taxable activity, they are required to pay GST on that payment. A deemed supply arises on the day the registered person receives the payment. (section 5(13)) A payment may be made by the insurer in late September 2010 but not received by the insured party until October 2010. This would mean that the recipient has to pay GST at the rate of 15% on the payment, but because the payment by the insurer may only factor in GST at the old rate of 12.5% 1 , the overall payment may not fully cover the loss. An amendment provides some leeway for payments in the pipeline (see section 78AA(14)). A payment under a contract of insurance received on or after 1 October 2010 is treated as being received on 30 September