GST and financial supplies

February 2012

The Government has released Exposure Draft material on a number of changes to the GST rules regarding financial supplies. These rules are expected to have effect from 1 July 2012.

The main changes relate to:

• Simplifying the treatment of hire purchase transactions and making them fully taxable.
• Altering the treatment of input taxed and reduced credit supplies typically associated with insurance products, lenders' mortgage insurance and fraud monitoring services and even into investment related services such as superannuation.

What the impact is to premiums and hire purchase arrangements is going to be in the detail.

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Last updated February 2012. This article is provided for information purposes only and should not be used in place of advice from your accountant. Please contact us on 02 9957 4033 to discuss your specific circumstances.