Special supplies for GST purposes
differ from normal business sales and purchases. A couple of examples you will frequently
come across are secondhand goods and hire purchase agreements.
When you purchase secondhand goods
from a supplier who is not registered for GST, you can claim a credit
for GST, based on the amount you have paid for the goods, as it is assumed GST
was never claimed on these goods on the initial purchase. You need to keep a
receipt, like you do for a normal purchase; it just won’t have a GST number for
the vendor. Please note that livestock and fine metals and jewels are excluded
from these provisions.
When you enter into a hire
purchase agreement to purchase goods, including financing on vehicles, GST is
claimable on the purchase price of the goods at the time they are purchased.
This is because the financing arrangement is separate to the supply of the
goods, and financing is exempt from GST.
Your accountant will need the
hire purchase/financing agreement, as it generally includes interest and set-up
costs, which are deductible for income tax purposes. They will also need the
tax invoice for vehicle purchases, as it can include additional on-road costs
that can be claimed in the year of purchase, instead of being included in the
vehicle cost that is added to the Asset Schedule and depreciated.