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Re: GST question on reimbursement cost

Newbie

Views 60

Replies 2

My company has engaged Company A for a project work. Both my company and Company A are Australian company and GST registered. The work included a software license which provided by a US Company US. 

 

Then we received an reimbursement invoice from Company A for the invoice from Company US to Company A. Since the invoice from Company US does not include GST, the invoice we receive does not include GST as well.

 

Questions:

1) Is it correct for Company A sent us the reimbursement invoice without GST?

2) If it is correct that the reimbursement invoice my company received is without GST, we cann't claim GST. But what if Company A is wrong, what should my company do?

 

Thank you.

1 ACCEPTED SOLUTION

Accepted Solutions

Most helpful response

ATO Community Support

Replies 1

Hi @DerekHu

 

The on-charging of invoices is a taxable sale, as that is a business cost of the supplier. The supplier in this is Company A.

 

While they would not have been charged GST by their overseas supplier on their digital product because their supplier was overseas, yours isn't.

 

This means that Company A would charge your business GST, even if there is no mark-up on the price. Your business will then claim a GST for that GST paid.

 

If your supplier (Company A) has gotten their invoice wrong, that's not on you. It's up to Company A to get their tax obligations correct. You can advise them that it should be revised, but at the end of the day it's on them. If they still won't revise it after letting them know, you can report a concern to us by making a tip-off.

 

You can read about taxable sales, imported services and digital products and making a tip-off on our website.

2 REPLIES 2

Most helpful response

ATO Community Support

Replies 1

Hi @DerekHu

 

The on-charging of invoices is a taxable sale, as that is a business cost of the supplier. The supplier in this is Company A.

 

While they would not have been charged GST by their overseas supplier on their digital product because their supplier was overseas, yours isn't.

 

This means that Company A would charge your business GST, even if there is no mark-up on the price. Your business will then claim a GST for that GST paid.

 

If your supplier (Company A) has gotten their invoice wrong, that's not on you. It's up to Company A to get their tax obligations correct. You can advise them that it should be revised, but at the end of the day it's on them. If they still won't revise it after letting them know, you can report a concern to us by making a tip-off.

 

You can read about taxable sales, imported services and digital products and making a tip-off on our website.

Newbie

Replies 0

Thank you, appreciated.