- The ATO has imposed a strict four-year time limit (the ITC period) for claiming input tax credits (ITCs) on GST returns, separate from the BAS review period.
- If a BAS is lodged late, the ATO allows GST liabilities but disallows ITCs for periods more than four years past the due date, leading to higher tax bills and penalties.
- The only way to protect ITC entitlements is to lodge a valid objection within the four-year ITC period.
- The misalignment between the ITC period and BAS review period can result in unfair outcomes for taxpayers, especially when BASs are lodged late.
- Legislative changes are needed to align these periods, and tax practitioners must act quickly to protect clients’ ITC entitlements.
Source: ggi.com
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
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