Private ruling: GST - financial supplies RITCs
Date of advice: 28 January 2026
Published: 30 March 2026

Ruling: Q1: 1. For the acquisition of services by xxx from the xx that relate to promoting and introducing potential customers to the home loan products, deposit account products, and transaction account products (collectively the Products), is the acquisition a Reduced Credit Acquisition (RCA) under item 11(e), Item 14 or item 27 in section 70-5.02 of the A New Tax System (Goods and Services Tax) Regulations 2019 (GST Regulation), such that xx as the GST Group representative is entitled to the Reduced Input Tax Credits (RITCs)? 2. If no to Question 1 in respect to all items, does the acquisition of services by xxx from the xx that relate to promoting and introducing potential customers to the Products and resulting in a customer starting an application for an account, constitute as a RCA under item 11(e), Item 14 or item 27 in section 70-5.02 of the GST Regulation, such that xx as the GST Group representative is entitled to the RITCs? 3. If no to Questions 1 and 2 in respect to all items, does the acquisition of services by xx from the xx that relate to promoting and introducing potential customers to the Products and resulting in the customer opening an account, constitute as a RCA under item 11(e), Item 14 or item 27 in section 70-5.02 of the GST Regulation, such that xx as the GST Group representative is entitled to the RITCs? | A1: No, in respect of each of the above questions the relevant acquisition is not an RCA and there is no entitlement to RITC.

Relevant facts and circumstances: You are an Australian Public Company. You hold an Australian Financial Services License and Australian Credit License and is an authorised deposit-taking institution. xxx is the GST Group Representative of your GST Group. You are registered for GST and is a member of a GST Group. You offer customers retail banking products which consist of Home Loans, Deposit Accounts and Transaction Accounts ('the Products'). To reach new and potential customers, you engage external suppliers to promote your products on their websites ('the services'). Traffic from these sites generate leads which are then actioned by your sales team for the purposes of converting these to applications. The various suppliers operate price comparison websites also knowns as 'Various entities' You have entered into contracts with each of the Various Entities with the relevant terms of agreement. All Various Entities are registered for GST and treat their supplies to you as taxable supplies. Various entities provide websites that allow consumers to easily compare products and services. You agree to make payment to each of the Various Entities, and we will refer to each of the payment that is being made as the 'Service Fee'. The specific payment arrangements with each Varius Entities are individually negotiated and vary depending on the campaign's nature and the services requested. You may be charged additional amounts in certain circumstances.

Relevant legislative provisions: A New Tax System (Goods and Services Tax) Act 1999 - section 11-5 | A New Tax System (Goods and Services Tax) Act 1999 - section 11-15 | A New Tax System (Goods and Services Tax) Act 1999 - section 48-45 | A New Tax System (Goods and Services Tax) Act 1999 - section 70-5 | A New Tax System (Goods and Services Tax) Regulations 2019 - section 40-5.07 | A New Tax System (Goods and Services Tax) Regulations 2019 - section 70-5.02

Reasons for decision: Detailed Reasoning - Creditable acquisition: An acquisition is any form of acquisition whatsoever, with the definition under section 11-10 including things that correspond with those things included in the broad definition of supply. As such, for every supply there is a recipient and an acquisition. xx will be entitled to input tax credits for any creditable acquisitions it makes under section 11-5 which provides: You make a creditable acquisition if: (a) you acquire anything solely or partly for a creditable purpose; and (b) the supply of the thing to you is a taxable supply; and (c) you provide, or are liable to provide, consideration for the supply; and (d) you are registered or required to be registered for GST. It is not in contention that you and/or your GST Group make input taxed financial supplies and has exceeded the financial acquisitions threshold. Therefore, the acquisitions are not made for a creditable purpose under paragraph 11-15(2)(a). Subsection 70-5(1) establishes that you may be entitled to a reduced input tax credit (RITC) where the acquisitions qualify as a reduced credit acquisition (RCA) listed in the GST Regulations. You submit that the services provided by the Various Entities to you should qualify for a RITC under GST Regulation 70-5.02 item 11(e), item 14 and item 27 in section 70-5.02 of the GST Regulation. Specifically, the services provided by Various Entities involve referring users to xxx when users click on a range of content on the Various Entities website. | Detailed Reasoning - Reduced Credit Acquisitions: Subsection 70-5.02(1) of the GST Regulations lists the RCAs which give rise to an entitlement to an RITC. In this case the relevant items to be considered are: • Item 11(e) in section 70-5.02 of the GST Regulations (Item 11) • Item 14 in section 70-5.02 of the GST Regulations (Item 14) • Item 27 in section 70-5.02 of the GST Regulations (Item 27) Item 11 covers loan services and states: 11. The following supplies by a financial supply facilitator: ... e) introducing and broking Item 14 covers loan application, management and processing services and states: 14. The following loan application, management and processing services: (a) loan origination and brokerage; (b) settlement and discharge of loans, including document preparation; (c) registration of loan documents; (d) credit reference assessment and credit scoring analysis; (e) valuations; (f) property title searches; (g) registration and certification of titles; (h) mortgage variations, including name changes; (i) lodging and removing caveats to titles Item 27 states: 27. Supplies for which financial supply facilitators are paid commission by financial supply providers | Detailed Reasoning - Item 11 and Item 27: Item 11 and Item 27 both refer to the term financial supply facilitator. A financial supply facilitator is defined in section 40-5.07 of the GST Regulations, in relation to a supply of an interest, as an entity facilitating the supply of an interest for a financial supply provider. Item 27 also requires the relevant payment to satisfy the meaning of 'commission'. In Goods and Services Tax Ruling GSTR 2004/1 Goods and services tax: reduced credit acquisitions (GSTR 2004/1), the Commissioner provides guidance on which acquisitions are reduced credit acquisitions that entitle a financial supply provider to a reduced input tax credit. Paragraphs 30-35 provides an explanation on what is a financial supply facilitator. 30. The regulations distinguish between a supply made by a financial supply facilitator and one made by a financial supply provider. As discussed in paragraph 103 of GSTR 2002/2, the definitions of these terms serve to avoid confusion between the provision of actual financial supplies and other supplies made in connection with them. 31. A financial supply facilitator, in relation to a supply of an interest, is defined in regulation 40-5.07 to be an entity facilitating the supply of an interest for a financial supply provider. The facilitating of a supply refers to activities that help forward (assist) the supply, rather than those that simply assist the financial supply provider. An entity facilitates the supply of an interest where its activities have the effect of helping forward or assisting the supply, therefore, the activities must have a sufficient nexus with the supply of an interest by a financial supply provider. 32. To have a sufficient nexus, the activities of the entity must have an identifiable association with the supply that goes beyond a mere general association. An identifiable association does not mean that the activities have to be directly linked to the supply, however it does require that there be a substantial connection so as to exclude activities that are only generally related (for example, promotion, advertising, product design, market research or similar types of activities). The activities must relate to and assist a particular supply, not merely contemplated supplies. In the absence of this identifiable association, an entity will not be a financial supply facilitator of the supply of an interest. 33. An entity is a financial supply facilitator of a particular supply. The fact that an entity is a financial supply facilitator in relation to one, or a number of transactions does not necessarily make it a financial supply facilitator in relation to another transaction. Being a financial supply facilitator is not a characteristic of an entity, but describes the entity's role in a particular transaction. 34. As a general rule, acting in an agent-like capacity on behalf of a financial supply provider (including the acquirer of a financial interest in relation to a particular transaction) indicates an identifiable association with the supply of an interest, as the activities of the agent are substantially connected with the supply of the interest. Acting as an agent, or in an agent-like capacity is the most common way in which the activities of an entity can have an identifiable association with the making of a financial supply, however, we recognise that it may not be the only way. 35. The term financial supply facilitator is specific to subregulation 70-5.02(2) and to those items listed in the subregulation. The term is defined in regulation 40-5.07. The services acquired from financial supply facilitators that are eligible for a reduced input tax credits are outlined in the relevant items in subregulation 70-5.02(2). For the purposes of these items, if a financial supply facilitator does not provide the specific service mentioned, the service is not a reduced credit acquisition. For example, an entity may be a financial supply facilitator in relation to the supply of an interest in an account, but the service it provides will not be a reduced credit acquisition unless it is the service of opening, issuing, closing, operating, maintaining, or performing a transaction in respect of, the account. Broadly, for the purposes of both Item 11 and Item 27, a supply of introducing must be by a financial supply facilitator, which requires that the service is directed towards a specific supply. Specific to Item 11(e) paragraphs 355 to 361 in GSTR 2004/1 states: 355. For the purposes of item 11, a supply of introducing must be by a financial supply facilitator, which requires that the service is directed towards a specific supply. It follows that introducing borrowers to lenders in a general sense is not sufficient to satisfy this requirement. ... Example 45 - introducing by a financial supply facilitator 358. SouthBank is a large non-bank financial institution offering mortgage home loans. SouthBank enters into an arrangement with a real estate franchise, Metro Real Estate Ltd, under which Metro introduces home buyers to SouthBank's loan products exclusively and refers their details directly to SouthBank. SouthBank has agreed to pay Metro $400 for each loan written through an application prepared for the borrower by Metro. In relation to each of these applications, Metro is a financial supply facilitator. 359. The acquisition of introduction services by SouthBank from Metro Real Estate Ltd is a reduced credit acquisition under item 11(e) as Metro is a financial supply facilitator in relation to the loans. Example 46 - introducing not by a financial supply facilitator 360. Western Loan Bank Ltd (Western) targets young home owners for its equity loan product. Western has an agreement with House Mart Ltd (House Mart), a national real estate franchise, under which House Mart mails Western equity loan applications and brochures to clients on its data base who are first home buyers. Western pays House Mart $30,000 for this service. House Mart's activities introduce Western's equity loan product to prospective borrowers. 361. However, House Mart is not a financial supply facilitator as there is no close connection between the services supplied by House Mart and particular supplies of interests in loans made by Western. The acquisition is not a reduced credit acquisition under item 11(e). In Goods and Services Tax Determination GSTD 2007/1 Goods and services tax: is a credit card provider entitled to a reduced input tax credit under item 27 of the table in sub regulation 70-5.02(2) of the A New Tax System (Goods and Services Tax) Regulations 1999 for the acquisition of services from a co-branding partner where it pays commission for those services? (GSTD 2007/1) it states at paragraph 17: 17. The Commissioner, in GSTR 2002/2 and GSTR 2004/1, has set out principles for determining whether an entity is a 'financial supply facilitator' for the purposes of subregulation 70-5.02(2) of the GST Regulations. A summary of these principles is as follows: • being a financial supply facilitator describes the role that the entity plays in a particular transaction and is not a characteristic inherent of the entity itself; • an entity can be a financial supply facilitator in relation to some transactions but not in relation to others; • the particular supply may be an actual financial supply or it may be a supply that the entity intends to make; and • the activities of the entity must have an identifiable association with the supply that goes beyond a mere general association for the entity to be a financial supply facilitator. An identifiable association requires there to be a substantial connection so as to exclude activities that are only generally related. For the co-branding arrangements contemplated in GSTD 2007/1, it states at paragraph 22 to 25: 22. In determining whether services provided by a co-branding partner have a substantial connection to the financial supply of the interest in the credit arrangement, consideration is to be given to the services provided as a whole, because none of the individual services listed in paragraph 4 of this Determination is determinant. Also, the provision of some services in isolation would not have a substantial connection with the supply of the interest in the credit arrangement. 23. For example, where the co-branding partner's involvement in the issue of the credit cards merely involves providing a list of names, or access to a customer data base, there is not considered to be a substantial connection with the financial supply of the interest in the credit arrangement. Therefore, the co-branding partner is not a financial supply facilitator. 24. Further, the supply by a co-branding partner of credit card marketing and promotional services, in isolation, is not considered to have a substantial connection to the supply of the interest in the credit arrangement. Similarly, an isolated supply by a co-branding partner of processing credit card applications is not considered to have a substantial connection to the financial supply of the interest in the credit arrangement. 25. However, these activities may be provided as part of a package which includes, for example, sourcing and introducing customers, providing a telephone application facility and follow up activities where application forms have not been correctly completed. Such a package of services, when looked at as a whole, is indicative of the co-branding partner playing an active role in forwarding and assisting the supply of the interest in the credit arrangement. The acquisition of such a package of services would be considered to have a substantial connection with the supply of the interest in the credit arrangement and, consequently, the co-branding partner would be considered a financial supply facilitator in relation to that supply. You submit that the Various Entities have a substantial connection to the making or intention to make a financial supply. This is on the basis that the Various Entities apply a targeted approach when introducing potential customers to xxx displaying xxx products on their website. Further, xx considers that the Various Entities 'play a role of a facilitator, connecting xx to potential customers, which is integral to the making of the financial supply by xx. In support of their submission xx refer to example 3 in GSTD 2007/1 and example 45 in GSTR 2004/1. In this case, we accept that xxx as the provider of the Products is a financial supply provider of an interest. However, we do not agree with the conclusion that the acquisition from the Various Entities has a substantial connection to the supply of the Products, such that the Various Entities are a financial supply facilitator. Based on the circumstances, GSTD 2007/1 does not apply as there is no co-branding arrangement. Notwithstanding, the approach taken in GSTD 2007/1 is consistent with the view in GSTR 2004/1 and 2002/2. That is, it is necessary to consider whether the acquisition of services from the Various Entities have an identifiable association with the supply that goes beyond a mere general association. In this case, similar to example 46 in GSTR 2004/1, the activities of the Various Entities consist of listing the Products on price comparison websites and/or advertising xx Products, with the added feature of allowing users to click on a link that directs them to xx website. xx pays the Various Entities the Service Fee for the supply. Consequently, there is no close connection between the services supplied by the Various Entities and particular supplies of interests in the Products by xx. As such, the Various Entities are not financial supply facilitators, as the services do not go beyond a mere general association. That is, the supply by the Various Entities is not an activity that help forward (assist) the supply of the interests by xx. Therefore, xx does not meet the requirements of Item 11(e) and Item 27. On the basis that the requirements of a financial supply facilitator have not been met, it is not necessary to consider whether the payment satisfies the definition of commission. | Detailed Reasoning - Item 14: Item 14(b) to Item 14(i) do not apply in respect to the acquisitions made. Therefore what needs to be considered is whether 14(a) regarding loan origination and brokerage is relevant. Paragraphs 372 - 378 from GSTR 2004/1 states that: 372. The phrase loan origination and brokerage is to be read as if the word loan appears before both origination and brokerage. 373. The expression origination in the context of item 14(a) means the initiating of loans by an entity on behalf of a lender. 374. Loan origination can also refer to the activities of an entity in sourcing borrowers and initiating loans in its own right, with the funds often being sourced through a securitisation entity, bank or other wholesale lender. However, a loan originator who lends funds in its own right, (often referred to as a non-bank lender) is a financial supply provider. As regulation 70-5.02 relates to acquisitions made by financial supply providers, loan origination in the context of item 14(a) refers to a service of initiating loans on behalf of the lender. 375. [Omitted.] 376. It follows that loan origination, in the sense referred to in paragraphs 372 and 374, being the initiating of a loan, may be seen as having a meaning similar to brokerage. As such, the expression loan origination and brokerage can refer to the service of initiating a loan with a borrower on behalf of a lender, being a loan application or processing service. 377. The expression 'origination' is often used interchangeably with brokerage, though it can also apply to other services acquired by a lender in initiating a loan (see example 47). 378. It is important to note that item 14 refers to services. As discussed at paragraph 86, the word services when interpreted in conjunction with the word processing is more than an alternative to supply. It connotes the active involvement of the entity in the processing of loan applications. As such, the acquisition of a loan origination software package is not a reduced credit acquisition under item 14(a). In this case, the Products consists of home loan products, deposit account products, and transaction account products. Only one of the products is a loan, namely the home loan product, whereas the remaining are not loan products, therefore item14(a) cannot apply. In conclusion after assessing the character of the relevant acquisitions and whether the acquisition meets the description of item 11(e), item 14 and item 27, we do not consider that you are entitled to an RITC.