79‑95 How to work out decreasing adjustm

79‑95 How to work out decreasing adjustments using the applicable average input tax credit fraction

(1) If an *operator of a *compulsory third party scheme has a *decreasing adjustment in relation to a payment or supply that is to be worked out using the applicable *average input tax credit fraction, the amount of the *decreasing adjustment is as follows. (2) The amount is worked out using the formula:

Start formula start fraction 1 over 11 end fraction times Payment or supply amount times open bracket 1 minus Applicable average input tax credit fraction close bracket end formula

where:

applicable average input tax credit fraction is the *average input tax credit fraction for the *compulsory third party scheme concerned for the *financial year in which:

(a) if the payment or supply is a \*CTP compensation payment or supply—the accident or other incident to which the claim relates happened; or
(b) if the payment or supply is a \*CTP ancillary payment or supply—the payment or supply was made; or
(c) if the payment or supply is a payment or supply to which section 79‑15 applies—the accident or other incident to which the claim relates happened.

payment or supply amount is the amount worked out in accordance with subsection (3).

Payment or supply amount (3) The payment or supply amount mentioned in subsection (2) is worked out using this method statement.

Method statement

Step 1. Add together:

(a) the sum of the payments of *money, or *digital currency, (if any) that are included in the payment or supply; and

(b) the *GST inclusive market value of the supplies (if any) made by the *operator that are included in the payment or supply (other than supplies that would have been *taxable supplies but for section 78‑25 or 79‑60).

Step 2. If, in relation to the payment or supply, any payments of an excess were made to the *operator, subtract from the step 1 amount the sum of all those payments (except to the extent that they are payments of excess to which section 78‑18 or 79‑55 applies).

Step 3. Except where the payment or supply is a *CTP ancillary payment or supply, multiply the step 1 amount, or (if step 2 applies) the step 2 amount, by the following:

Start formula start fraction 11 over 11 minus Applicable average input tax credit fraction end fraction end formula

where:

applicable average input tax credit fraction has the meaning given by subsection (2).

Reduction for non‑creditable insurance events (4) The amount of the *decreasing adjustment under subsection (1) is reduced to the extent (if any) that the payment or supply relates to one or more *non‑creditable insurance events.