21H Transitional accounting rules

(1)

This section applies in relation to goods or services acquired before 1 April 2011 when—

(a)

a registered person determines the extent to which goods or services are applied for the purposes of making supplies other than taxable supplies under sections 21 to 21H (the old apportionment rules) as they were before the enactment of the Taxation (GST and Remedial Matters) Act 2010:

(b)

no adjustment was made or was required to be made under the old apportionment rules before 1 April 2011 for goods or services other than those referred to in section 21HB.

(2)

The person must continue to apply the old apportionment rules in relation to the supply. However, the making of these adjustments is limited as follows:

(a)

for goods or services whose market value or book value on 1 April 2011 is $5,000 or less, no adjustment under the old apportionment rules may be, or may be required to be, made after 1 April 2011:

(b)

for goods or services whose market value or book value on 1 April 2011 is more than $5,000 but not more than $10,000, no adjustment under the old apportionment rules may be, or may be required to be, made after 1 April 2013:

(c)

for other goods or services, no adjustment under the old apportionment rules may be, or may be required to be, made after 1 April 2016.

(2B)

For goods or services that were acquired before 1 April 2011, for which no adjustment was made or required under the old apportionment rules before 1 April 2011, and that are not referred to in section 21HB(1), this section applies modified as follows:

(a)

if input tax was deducted under section 20(3) in relation to the goods or services, or if the goods or services were zero-rated at the time of purchase, the person must apply the old apportionment rules in relation to the supply:

(b)

if no input tax was deducted under section 20(3) in relation to the goods or services, the person must apply the new apportionment rules set out in sections 21 to 21G and subsection (2C).

(2C)

For the purpose of subsection (2B)(b), the first adjustment period is treated as beginning on the date of acquisition of the goods or services and ending on the date that is the first balance date falling after the later of—

(a)

the date on which the goods or services were first used for making taxable supplies:

(b)

the date on which the person becomes a registered person.

(3)

Subsection (2)(a) to (c) do not apply to a supply that wholly or partly consists of land.

Section 21H: substituted, on 1 April 2011 (applying to supplies made on or after 1 April 2011), by section 15(1) of the Taxation (GST and Remedial Matters) Act 2010 (2010 No 130).

Section 21H(1): replaced (with effect on 1 April 2011), on 2 November 2012, by section 221(1) of the Taxation (Annual Rates, Returns Filing, and Remedial Matters) Act 2012 (2012 No 88).

Section 21H(2B): inserted (with effect on 1 April 2011), on 2 November 2012, by section 221(2) of the Taxation (Annual Rates, Returns Filing, and Remedial Matters) Act 2012 (2012 No 88).

Section 21H(2C): inserted (with effect on 1 April 2011), on 2 November 2012, by section 221(2) of the Taxation (Annual Rates, Returns Filing, and Remedial Matters) Act 2012 (2012 No 88).