Paying Suppliers After Claiming GST

Key Requirements

If the supplier is not paid within twelve months of the payment due date, repay the related input tax. For partial payment, calculate the tax fraction of the unpaid balance using the original applicable GST rate, and reduce taxable purchases and input tax in the relevant adjustment return. The twelve months run from the agreed payment due date, not simply the invoice date. Later payment allows reclaim only within five years from the end of the accounting period in which the input tax was first claimed. Monitor aged payables alongside GST records, keeping the original invoice, credit terms, payments and adjustment trail.