Private ruling: Creditable acquisition
Date of advice: 31 July 2025
Published: 29 September 2025
Ruling period: DDMMYYYY

Ruling: Q1: Is the payment consideration for a taxable supply from the suppliers to you (recipient), such that the recipient makes a creditable acquisition under section 11-5 of the A New Tax System (Goods and Services Tax) Act 1999 ( GST Act ) ? | A1: Yes, you make a creditable acquisition of a taxable supply from the suppliers under section 11-5 of the GST Act.

Relevant facts and circumstances: You (the recipient of the supply) is registered for GST. You issue Recipient Created Tax Invoices (RCTIs) for the supply provided by the suppliers which contains a 'Written Agreement' under which you and the relevant suppliers agree that you are parties to an RCTI agreement. The payee (here, the suppliers) must notify the you within 21 days of receiving the RCTI if the payee does not wish to accept this proposed agreement.

Relevant legislative provisions: A New Tax System (Goods and Services Tax) Act 1999 section 9-5 | A New Tax System (Goods and Services Tax) Act 1999 section 9-10 | A New Tax System (Goods and Services Tax) Act 1999 section 9-20 | 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

Reasons for decision: Summary: Section 11-5 provides that you make a creditable acquisition if: a) you acquire anything solely or partly for a creditable purpose b) the supply of the thing to you is a taxable supply c) you provide or are liable to provide consideration for the supply, and d) you are registered or required to be registered for GST. Each of the requirements in section 11-5 is considered below. Paragraph 11-5(a) - creditable purpose You make an acquisition if you are the recipient of a supply. As set out in the discussion on paragraph 11-5(b) below, the taxable supply made to you is a thing you have acquired for the purposes of paragraph 11-5(a). The acquisition must be for a creditable purpose. The meaning of creditable purpose is set out in section 11-15 which states: 1) You acquire a thing for a creditable purpose to the extent that you acquire it in carrying on your enterprise. 2) However, you do not acquire the thing for a creditable purpose to the extent that: a) the acquisition relates to making supplies that would be input taxed; or b) the acquisition is of a private or domestic nature. Under subsection 11-15(1) it is necessary to identify the enterprise that is being carried on and determine whether there is a connection between the acquisition and the enterprise. The term 'enterprise' is defined in section 9-20. An enterprise includes an activity, or series of activities, amongst other things, done in the form of a business, or in the form of an adventure or concern in the nature of trade. Your acquisition from the suppliers of the taxable supply, discussed below, is a thing necessarily acquired in carrying on your enterprise and the acquisitions are not related to making supplies that would be input taxed or acquisitions that are private or domestic in nature and is therefore acquired for a creditable purpose. Therefore, paragraph 11-5(a) is satisfied. Paragraph 11-5(b) - taxable supply Section 9-5 provides that you (here, the supplier) make a taxable supply if: a) you make the supply for consideration b) the supply is made in the course or furtherance of an enterprise that you carry on c) the supply is connected with the indirect tax zone, and d) you are registered or required to be registered for GST. However, the supply is not a taxable supply to the extent that it is GST-free or input taxed. The requirements in paragraphs 9-5(a) to (d) are satisfied by the suppliers. The supply (acquisition from your perspective) the subject of this ruling is not GST-free or input taxed. Accordingly, as all the requirements of section 9-5 have been satisfied, the supply you acquire from the suppliers is a taxable supply. Paragraph 11-5(c) - consideration As set out above, you have provided, or are liable to provide consideration. Therefore, paragraph 11-5(c) is satisfied. Paragraph 11-5(d) - registered for GST You are registered for GST. Therefore, paragraph 11-5(d) is satisfied. | Detailed Reasoning - Conclusion: As all the requirements in section 11-5 are satisfied, you have made a creditable acquisition from the suppliers.