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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Andrew Harris

Andrew Harris

Partner, Tax and Business services

Andrew has extensive experience as a tax advisor working in Australia, the United Kingdom, Uganda, Tanzania and Papua New Guinea. He has advised clients across all taxes, including international tax, ... More

Declan Mordaunt

Declan Mordaunt

Principal, Tax and Business Services

Declan is a Chartered Accountant in both New Zealand and Ireland. He has extensive experience as a tax specialist having worked in Ireland, New Zealand and the Middle East. He previously worked as a T... More