TaxTMI 
TaxTMI 
Can a supplier issue a Credit Not to its recipient for GST collected in excess, on downward revision of the price after the supply was made. The original invoice to which the CN is mapped shows GST collected on the Full value calculated at the original rate. This will reduce the output liability of the Supplier. IS such a CN equal to to the Refund as envisaged in the ACT.
Unjustenrichment - Issue of Credit Note
28 May 2018 
6 Replies 
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Credit note issuance for excess GST requires statutory grounds and may not substitute for refund where tax incidence was passed on.
A supplier may issue a credit note to correct excess GST charged only where the invoice overstated taxable value or tax, goods are returned, or supplies are deficient, and not if the tax incidence has been passed to another person. Receipt of a refund or reduction in supplier output tax may also require the recipient to reverse input tax credit. Known trade discounts at time of supply can support re determination of assessable value, whereas post transaction price variations typically cannot. If tax has been passed on, any refund may instead be diverted to a consumer welfare fund under the unjust enrichment principle. (AI Summary)
A supplier may issue a credit note to correct excess GST charged only where the invoice overstated taxable value or tax, goods are returned, or supplies are deficient, and not if the tax incidence has been passed to another person. Receipt of a refund or reduction in supplier output tax may also require the recipient to reverse input tax credit. Known trade discounts at time of supply can support re determination of assessable value, whereas post transaction price variations typically cannot. If tax has been passed on, any refund may instead be diverted to a consumer welfare fund under the unjust enrichment principle. (AI Summary)