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Farnzybob(Newbie)Newbie
30 Jan 2024

IBA has a Start Up Finance Package that states


"With our new start-up finance package, we make it easier to get your idea off the ground. To help you be competitive and minimise high interest borrowing, we'll award up to 30% of a new business loan as a grant to purchase assets for your business, which you will not have to repay. So you can get a head start on running your business"


The loan is for 100k and the client will only have to pay back 70k. is the 30k Assessable income and are there any GST implications?


Thanks!



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698 views
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Most helpful reply

AlliATO(Community Support)Community Support
1 Feb 2024

Hi @Farnzybob


The terms and conditions of the grant will generally determine if GST will apply or not.


When a business or organisation is registered for GST or is required to be registered for GST and receives a grant, they will not have to pay GST on the funding payment unless they have to make a supply in return for the payment. Our GST and grants page goes into more detail if you like to check it out.


The Goods and Services Tax Ruling GSTR 2012/2 will also guide you to determine if the grant you provide is a supply for consideration and establishes sufficient nexus.


If your unable to self-assess you can seek further assistance with our Tailored technical assistance team on how the law applies to the terms and conditions of the grant you’re providing. 

All replies

Most helpful reply

AlliATO(Community Support)Community Support
1 Feb 2024

Hi @Farnzybob


The terms and conditions of the grant will generally determine if GST will apply or not.


When a business or organisation is registered for GST or is required to be registered for GST and receives a grant, they will not have to pay GST on the funding payment unless they have to make a supply in return for the payment. Our GST and grants page goes into more detail if you like to check it out.


The Goods and Services Tax Ruling GSTR 2012/2 will also guide you to determine if the grant you provide is a supply for consideration and establishes sufficient nexus.


If your unable to self-assess you can seek further assistance with our Tailored technical assistance team on how the law applies to the terms and conditions of the grant you’re providing. 

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IBA Business Grant Assessable Income? | ATO Community