113ACorrection of certain errors in subsequent returns

1. This section applies for the purposes of this Act and the Goods and Services Tax Act 1985 when—

2. a person—
   1. has made an assessment of income tax or goods and services tax in a return that results in a tax liability for the person; or
   2. has provided a return that results in a liability for fringe benefit tax for the person; and
3. 1 or more errors in the assessment or return, as applicable, cause a tax discrepancy in the amount of the liability.

4. This section does not apply in relation to an assessment or return for an ancillary tax other than fringe benefit tax as described in subsection (1)(a)(ii).

5. If the total tax discrepancy amounts to $1,000 or less, the person may make a correction in the next return that is due after the discovery of the error or errors.

6. If the total tax discrepancy is caused by an error or errors that, for the person, is not a material error or are not material errors, the person may make a correction in the next return that is due after the discovery of the error or errors.

7. For the purposes of subsection (3B) and in relation to a single return of a person, an error is not material if the amount of the total tax discrepancy caused by the error or errors in the assessment or return, as applicable, is equal to or less than the lower of—

8. $10,000; and
9. 2% of the person’s—
   1. output tax, in the case of an assessment of goods and services tax; or
   2. annual gross income, in any other case.

10. Subsections (3) and (3B) do not apply to a person who applies the materiality threshold in subsection (4) in relation to an assessment of their liability for income tax or goods and services tax, or return for fringe benefit tax, if their main purpose in applying the threshold is to delay the payment of tax.