Pre-Paid Tax Invoices
No. Many customers are requesting a 'tax invoice' on the belief that this is required for general income tax deduction/claim and reimbursement purposes. Many customers also believe that Telstra is required under law to issue a 'tax invoice' for pre-paid recharges. This is in fact not the case.
A 'tax invoice' is a defined document for 'GST' purposes only under the GST Act. The purpose of a 'tax invoice' is to show the amount of GST charged on a supply so that a customer or their employer is able to assess a claim for GST on their Business Activity Statement (BAS) where the customer or employer is 'GST registered'.
Please note: Unless you are a customer or employer that is 'GST registered' with an Australian Business Number (ABN), you have no need for a 'tax invoice'.
As pre-paid recharges are not subject to GST at the time of recharge, Telstra is technically not able to provide a 'tax invoice' for the recharge. This applies to telephone recharges and like telecommunication services such as smartphone and tablet recharges and occurs as a result of Division 100 of the GST Act.
Telstra must comply with the application of Division 100 in this way.
If Telstra issued a 'tax invoice' with a GST amount for a recharge, Telstra would be in direct non-compliance with the GST law.
GST is accounted for by Telstra at the time of 'usage' by the customer based on the application of GST to each separate type of usage within the recharge amount and expiry time. This is in accordance with Division 100 of the GST Act.
Each instance of usage is taken to be a separate supply of a service for GST purposes and is assessed as to the application of GST at that time. Some usage may be GST-free and therefore no GST will be charged on the usage.
Technically, no. While a 'tax invoice' could be provided for actual usage as this is when GST is applied (to the extent that the type of usage is subject to GST itself), Telstra will, in almost all instances, never be required under the GST law to do so.
This is because Telstra has no tax obligation to issue tax invoices for charges less than $82.50 (GST inclusive) on a per call / usage basis. For pre-paid services, as each point of usage is taken to be a separate supply for GST purposes, a 'tax invoice' obligation does not arise for Telstra because it is unlikely that any separate instance of usage would exceed the recharge amount paid by the customer of $82.50.
The reason for this is that the GST law is not intended to impose an overly burdensome administrative process on service providers for low $ value charges.
Yes. Telstra has implemented the ability to view/print off tax invoice statements for usage history up to 180 days. Telstra Pre-Paid customers can view or download monthly statements for tax invoice purposes (up to five months) at My Pre-Paid Online for no charge. History will remain for up to 180 days for viewing.You are able to see/print your PrePaid Tax Invoices through Telstra's My Account for usage incurred.
Please Note: Because of the way GST is legally treated on a Pre-Paid service, Telstra cannot provide a Tax invoice until the relevant credit in your main account balance has been used.
Yes, in the circumstances allowed by the Australian Taxation Office (ATO).
Telstra (and other telecommunication providers) raised this issue with the ATO to reach a resolution for customers that are GST registered. The ATO ruled that 'receipts' could be used as 'tax invoices' provided the customer could still demonstrate that the usage of the recharge was subject to GST.
The ATO ruling is available through the ATO website and is stated as follows:
Sections within Issue 13 - Tax invoices for prepaid telephone cards
Nature of the arrangement
The amendments to vouchers provisions clarify that prepaid phone cards are eligible Division 100 vouchers and are not subject to GST at the time the phone cards are issued.Telephone cards are typically sold through retail outlets. The retailer will usually provide an invoice or tax invoice when the phone card is supplied. However, the taxable supply is the supply of domestic phone calls by the telco.Accordingly the tax invoice should be issued by the telco that makes the telecommunication supplies. Due to the way in which phone cards are distributed, the telco may not have sufficient reasonable way of knowing the details of the recipient of the telecommunication supplies in order to issue them with a tax invoice.Further, in many instances the price of the telecommunication supplies (each individual phone call, for example) will be less than $82.50(GST inclusive) and so the telco would not have a legal obligation to issue a tax invoice.IssueWhat are the tax invoice requirements where phone calls are made with a pre-paid telephone card that is considered to be a FVV [Face Value Vouchers] for GST purposes?DecisionThe Commissioner [of Taxation] will treat the receipt provided by the retailer for the purchase of a phone card as a tax invoice for the telephone calls that are made using that phone card. This decision applies only to pre-paid phone cards that are considered to be FVVs for GST purposes. The person using the phone card may need to substantiate that all telecommunication supplies:
- Were taxable supplies to them (for example, not GST-free international mobile roaming supplies); and were all creditable acquisitions
- If they want to claim input tax credits based on 1/11th of the price of the phone card shown on any invoice or tax invoice covered by the determination
A Receipt for recharge purchase is currently issued for purchases via any of the retail outlets.
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