Document ID: chunk:federal_register_of_legislation:C2010C00583:clause:11_18:p1
Version: federal_register_of_legislation:C2010C00583
Segment Type: clause
Provision Reference: sch 11 cl 18 (pt 1/18)
Character Range: 103936–106828

18  After Division 78
Insert:

Division 79—Compulsory third party schemes

79‑1  What this Division is about

      Operators of compulsory third party schemes have adjustments which enable the net GST on the schemes to reflect correctly their margins after settlements of claims and other payments and supplies under the schemes are taken into account.
      The normal application of Division 78 to some insurance policy payments and supplies under the schemes is modified (see Subdivision 79‑A). That Division is also extended so that it applies in a modified form to payments and supplies connected with, but not under, insurance policies (see Subdivision 79‑B). For other settlements, and payments, provisions similar to Division 78 apply (see Subdivision 79‑C). Certain adjustments are worked out using an "applicable average input tax credit fraction" (see Subdivision 79‑D).
Note: Division 80 deals with use of settlement sharing arrangements by the operators of compulsory third party schemes.

Table of Subdivisions

79‑A Modified application of Division 78 to certain compulsory third party scheme payments and supplies under insurance policies
79‑B Extension of Division 78 to cover certain compulsory third party scheme payments and supplies connected with, but not under, insurance policies
79‑C Other payments and supplies under compulsory third party schemes
79‑D Compulsory third party scheme decreasing adjustments worked out using applicable average input tax credit fraction

Subdivision 79‑A—Modified application of Division 78 to certain compulsory third party scheme payments and supplies under insurance policies

79‑5  Application of sections 78‑10 and 78‑15 (about decreasing adjustments) where premium selection test is satisfied

 (1) This section applies to a payment or supply if:
 (a) it is a payment or supply made under a *compulsory third party scheme; and
 (b) the payment or supply is made in settlement of a claim under an *insurance policy; and
 (c) the *premium selection test is satisfied; and
 (d) the payment or supply is not a payment or supply to which section 79‑15 (about sole operator elections) applies.

Premium selection test

 (2) The premium selection test is satisfied if the amount of the premium or premiums for the policy resulted from:
 (a) an *operator of the *compulsory third party scheme offering a number of different premium amounts to the entity liable to pay the premium or premiums; and
 (b) that entity selecting a premium amount:
 (i) that was offered on the basis that there would be an entitlement to an input tax credit for some or all of the amount; or
 (ii) that was offered on the basis that there would be no entitlement to an input tax credit for any of the amount.

Input tax credit entitlement

 (3) If subparagraph (2)(b)(i) applies, then, for the purposes of sections 78‑10 and 78‑15:
 (a) there is taken