Finance Circular 2004/04
Guidance on GST and employee entitlements
This Finance Circular applies to agencies under the Financial Management and Accountability Act 1997 (FMA Act agencies) and to Commonwealth authorities under the Commonwealth Authorities and Companies Act 1997. This Finance Circular replaces Finance Circular 2003/06 "Advice on the Application of the Goods and Services Tax to transfers of government employees' entitlements".
In summary, this Finance Circular:
- Describes two Interpretative Decisions (IDs) issued by the Australian Taxation Office (ATO), ATO ID 2003/1182 "GST and transfer of long service leave entitlements" and ATO ID 2004/362 "GST and transfer of annual leave, annual leave loading, flexitime and sick leave entitlements", which together provide that payments made in relation to transfers of government employee entitlements are not subject to Goods and Services Tax (GST); and
- Recommends that FMA Act agencies and Commonwealth authorities consider the application of ATO ID 2003/1182 and ATO ID 2004/362 (the decisions) to their circumstances.
While the ATO's Government Technical Team  is the appropriate point of reference for queries relating to the decisions, Attachment A to this Circular provides answers to some frequently asked questions regarding the application of the decisions.
© Commonwealth of Australia 2004
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