Financial Acquisitions Testing (FAT)


Financial Acquisitions Testing (FAT)

Does your business make financial supplies?

The financial acquisitions threshold test or FAT test has become a standard menu item for all GST audits. If you don’t know your FAT risk profile and you don’t have a FAT management program in place then this is a potential risk area for your business.

How would your business measure up to the FAT test under an ATO audit?

As a general rule if a business makes financial supplies then it may not be entitled to claim the GST credits on the costs associated with making those supplies.

The FAT is a de minimis test that allows businesses that only make minor financial supplies to claim full GST credits on the costs associated with those supplies. However, if your business fails the FAT test then you may not be entitled to claim all of the GST credits on the costs associated with your financial supplies.

How can Deloitte help?

We can help your business manage its FAT obligations by:

  • Undertaking a detailed review of your business to identify the financial supplies that are made
  • Applying and calculating the FAT test to identify any exposures
  • Establishing and implementing an on-going FAT monitoring process
  • Assisting with and managing any voluntary disclosures to the ATO.

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Jon Graham

Jon Graham

Partner, Indirect tax

Jon is the partner in charge of the Indirect Tax and Customs Practice in Deloitte Australia, a team of approximately 70 dedicated indirect tax specialists. Jon has 24 years' experience advising on glo... More