GST input tax credits do not stay claimable forever. Under Division 93 of the GST Act, and confirmed in the ATO's Miscellaneous Taxation Ruling MT 2024/1, a credit expires four years from the due date of the original BAS for the tax period in which it could first have been claimed. Not four years from the invoice date, and not four years from when the BAS was actually lodged. Four years from the date the BAS was due. That single distinction is what makes this rule so unforgiving, and it is where firms lose real money for clients, because the clock is running against a date most people are not watching.
How the four-year rule actually works
The example makes it concrete. A client buys equipment in March 2020, their quarterly BAS for that period is due 28 April 2020, and the four-year credit time limit therefore ends at the close of 28 April 2024. If that credit has not been included in an assessed BAS by that date, it is gone. The ATO has been explicit, in MT 2024/1 and in Tribunal decisions, that it has no discretion to extend the period or amend an assessment to include the credit once the window has closed. There is no relief for administrative delay, a change of accountant, or simple oversight. The entitlement ceases, and nothing lodged afterwards can revive it.
There is a process trap here that catches firms exactly when they are trying to help, and it is the most important thing to understand about this rule. Lodging an amendment request or a voluntary disclosure does not preserve the credit. The ATO has to actually process the amendment and include it in the assessment within the four-year window, so a request sitting unprocessed in the ATO's queue when the deadline passes results in an expired credit regardless of when it was submitted. The one action that does preserve entitlement is a valid objection lodged within the four-year period, which is treated differently from an amendment request and holds the credit open to the extent it is the subject of that objection. So near a deadline, the technically correct move is often an objection, not just an amended BAS. As a practical matter the ATO recommends lodging a Revised BAS through Online Services rather than a written amendment request, because an RBAS is processed faster, and if a credit is within a month of expiring and still unprocessed, it advises calling 13 28 66 to follow it up directly. Speed of processing, not speed of lodging, is what actually matters.
Where this catches firms during catch-up work
Catch-up bookkeeping is where Division 93 does the most damage, because a client who has not lodged correctly for years arrives with a backlog of unclaimed credits, some still inside the four-year window and some already lost. The firm's first job, before doing any of the catch-up work, is to sort the recoverable periods from the dead ones, because time spent reconstructing an expired period recovers nothing. The calculation is simple in principle: take the due date of the original BAS for each unclaimed period, add four years, and any period whose date has already passed is unrecoverable. What complicates it in practice is that clients with irregular histories may have review periods that shifted because of prior amendments or late lodgement, and the trap is assuming the credit clock moved with them. It did not. The credit time limit runs from the original due date regardless of when the BAS was actually lodged, so a late-lodged period does not buy any extra time to claim its credits.
The asymmetry is what makes this genuinely punishing, and clients need to hear it plainly. The four-year expiry applies only to credits. There is no matching expiry on GST liabilities. So the ATO can still assess and collect underpaid GST on sales from those same old periods while the credits on purchases from the same quarter have vanished. A client who failed to lodge for years can end up assessed for the full GST on their sales with none of the offsetting credits on their costs, which is far worse than either problem alone and completely contrary to how the GST system is meant to net out.
The takeaway
The four-year credit time limit is one of the few corners of tax law with genuinely no safety net. The ATO has said, and the Tribunal has confirmed, that once the window closes it cannot help, and the only thing that reliably preserves a credit near the deadline is a valid objection lodged in time. For catch-up work, the first task before touching any historical period is to calculate which credits are still within time and prioritise those, hardest deadlines first. For ongoing clients, a quarterly check that no claimable credits are approaching the four-year mark is a trivial addition to BAS preparation that costs nothing and prevents a loss that, once it happens, is permanent and often only recoverable by the client suing whoever let it lapse.
