1.3.6 Calculate GST recovery amounts
1.3.6.1 Responsibility to calculate GST | 1.3.6.2 Calculate recovery for erroneous payments | 1.3.6.3 Calculate recovery for other recovery types
Agents must take into account GST when estimating and calculating recovery amounts.
Agents may be responsible for calculating recovery of GST for up to 12 out of 20 recovery types.
This section explains the amount of recovery applicable – net or gross of GST, the correct treatment of GST liability, ITC Input Tax Credit or DAM reversal and comments for each of the four relevant recovery types.
1.3.6.1 Responsibility to calculate GST
The following table shows who is responsible to calculate, request, record and bank recoveries across the WorkCover Scheme, including GST:
| Recovery type code | Calculate and request recovery (incl. GST) | Record recovery amounts and banking |
|---|---|---|
| 1, 2, 3, 4, 5, 8, 9, 12, 13, 14, 20, 23, 27, 28 | WorkSafe | WorkSafe |
| 10, 11, 18 | Agents | WorkSafe |
| 7, 16, 17, 24, 25 | Panel firms/Agents/WorkSafe | WorkSafe |
| 6, 15, 19 | Agents | Agents |
| 21, 22 | WorkSafe | WorkSafe |
Codes Agents are responsible for
| Code number | Description |
|---|---|
| 6 | Erroneous overpayments such as overpayments of compensation to the worker, provider or the employer arising out of an error or mistake on the part of the WorkSafe and/or an Agent. |
| 15 |
Recoveries where no entitlement exists.
  |
| 19 | Recoveries of claims fraud and associated costs. |
| 20 | Recoveries from a worker for compensation or damages paid /payable by interstate insurers or an interstate jurisdiction where the WorkSafe has paid compensation for the same employment related accident. These claims are to be referred to the WorkSafe’s Recoveries Team.
|
1.3.6.2 Calculate recovery for erroneous payments
When calculating the recovery for erroneous payments, Agents need to identify the total gross amount to be recovered. Agents then need to break down the total gross amount into separate amounts for each payment type (where more than one payment type is the subject of recovery).
Finally, the GST applicable amount needs to be identified (where a non-settlement A lump sum payment that replaces an injured worker's right to ongoing weekly compensation. payment type is subject to recovery).
Example
An Agent pays an invoice in error. The invoice is for two legal actions, the first costing $2,000 and the second costing $1,100. The first was incurred on 6/06/2000 and the second was incurred on 11/07/2000. The recovery details are:
| Description | Details |
|---|---|
| Recovery type | 6 |
| Gross amount | $3,100 |
| Legal Action 1 | $2,000 – payment type 114 (non-settlement) |
| 6, 15, 19 | $1,100 – payment type 114 (non-settlement) |
| 21, 22 | $1,100 (as only the second report was subject to GST) |
Agents need to determine whether or not the amount to be recovered is either net or gross of GST. For recovery type 6, the gross amount should be recovered (refer to GST recovery type codes).
Request $3,100 from legal firm.
1.3.6.3 Calculate recovery for other recovery types
To calculate the recovery amount for recovery types 15 & 19 Agents must identify the gross amount for recovery. Once this has been identified, Agents must also determine the gross amount of:
- settlement payments.
- non-settlement payments.
Of the non-settlement payments identified in (2), determine the amount of those payments which is GST applicable.
Example
WorkSafe has made payments of $500 medical fees and $200 investigation costs in respect of a claim made by a worker. Subsequent evidence shows that the claim was accepted and paid due to a ‘mistake of fact’.
Your records show that of the $200 investigation payment, $110 was subject to GST as costs were incurred after 1 July 2000 and the remaining $90 was not subject to GST as it was incurred before 1 July 2000. The details are:
| Description | Details |
|---|---|
| Recovery type | 15 |
| Gross amount | $700 |
| Settlement amount | $500 |
| Non-settlement amount | $200 and of this, $110 was GST applicable |
Agents need to determine whether or not the amount to be recovered is either net or gross of GST. For recovery type 15, the gross amount should be recovered.
Refer to GST recovery type codes.
Request $700 from worker or employer, as appropriate.