[et_pb_section fb_built=”1″ custom_padding_last_edited=”off|desktop” _builder_version=”4.27.2″ custom_margin=”0px||0px||false|false” custom_padding=”0px||0px||false|false” custom_padding_phone=”0px||||false|false” da_disable_devices=”off|off|off” locked=”off” global_colors_info=”{}” da_is_popup=”off” da_exit_intent=”off” da_has_close=”on” da_alt_close=”off” da_dark_close=”off” da_not_modal=”on” da_is_singular=”off” da_with_loader=”off” da_has_shadow=”on”][et_pb_row column_structure=”1_3,2_3″ _builder_version=”4.27.2″ background_size=”initial” background_position=”top_left” background_repeat=”repeat” width=”100%” custom_margin=”0px||0px||false|false” custom_padding=”0px||0px||false|false” global_colors_info=”{}”][et_pb_column type=”1_3″ module_class=”table-contents” _builder_version=”4.23″ background_color=”#f3f2f6″ custom_padding=”25px||25px||true|false” sticky_position=”top” sticky_limit_bottom=”section” sticky_position_tablet=”top” sticky_position_phone=”none” sticky_position_last_edited=”on|desktop” border_radii=”on|24px|24px|24px|24px” global_colors_info=”{}” custom_padding__hover=”|||”][et_pb_text _builder_version=”4.23″ text_font=”||||||||” global_colors_info=”{}” background__hover_enabled=”on|desktop”][\/et_pb_text][\/et_pb_column][et_pb_column type=”2_3″ _builder_version=”4.16″ custom_padding=”|||” global_colors_info=”{}” custom_padding__hover=”|||”][et_pb_text admin_label=”Definition description + related terms” _builder_version=”4.27.6″ header_2_font_size=”32px” hover_enabled=”0″ header_2_font_size_tablet=”30px” header_2_font_size_phone=”26px” header_2_font_size_last_edited=”on|tablet” global_colors_info=”{}” sticky_enabled=”0″]<\/p>\n
Most businesses are familiar with the standard invoicing process: the supplier issues the tax invoice and the purchaser pays. Simple, right? Not exactly. In some special cases, the process is flipped on its head \u2013 and that\u2019s where Recipient Created Tax Invoices (RCTIs) come into play.<\/p>\n
If you\u2019re dealing with multiple suppliers or contractors, or if you need to juggle complex pricing arrangements, an RCTI might be the way to go in order to simplify your admin and keep the Australian Taxation Office (ATO) happy.<\/p>\n
[\/et_pb_text][et_pb_image src=”https:\/\/www.reckon.com\/au\/wp-content\/uploads\/2025\/08\/When-a-RCTI-can-be-created.png” alt=”RCTI process” title_text=”When A RCTI Can Be Created” align=”center” _builder_version=”4.27.4″ _module_preset=”default” custom_margin=”-50px||||false|false” custom_padding=”||||false|false” global_colors_info=”{}”][\/et_pb_image][et_pb_text _builder_version=”4.27.4″ _module_preset=”default” global_colors_info=”{}”]<\/p>\n
An RCTI is a valid tax invoice created by the recipient (the purchaser) of goods or services, rather than the supplier. In short, instead of waiting for a supplier to issue an invoice, the recipient creates the tax invoice<\/a> and sends it to the supplier. This is only allowed under specific conditions set out by the ATO.<\/p>\n Here are the only scenarios where an RCTI can be used:<\/p>\n As an example, let\u2019s say an RCTI is used by a grain co-operative paying farmers for crops, or a government department disbursing grants. Both are situations where the purchaser is better placed to determine the value of services and then issue the invoice themselves.<\/p>\n You can only generate a recipient created tax invoice if the goods or services fall under the categories approved by the ATO. The arrangement also needs to be properly documented in a written agreement that outlines:<\/p>\n If anyone fails to meet these conditions, it will mean the tax invoice is invalid, which could hamper your ability to claim input tax credits on your BAS<\/a>.<\/p>\n Creating an RCTI is similar to generating a standard tax invoice, but you have to label it as a \u2018Recipient Created Tax Invoice\u2019. It should include all the usual elements of a normal tax invoice like:<\/p>\n Need help getting started? Use a pre-made RCTI template in Word, Excel or your accounting software<\/a> (like Reckon) to stay compliant.<\/p>\n [\/et_pb_text][et_pb_text admin_label=”Related terms” _builder_version=”4.27.4″ header_2_font_size=”32px” header_2_font_size_tablet=”30px” header_2_font_size_phone=”26px” header_2_font_size_last_edited=”on|tablet” locked=”off” global_colors_info=”{}”]<\/p>\n See related Terms:<\/strong><\/p>\n What is an invoice?<\/a> [\/et_pb_text][ba_social_share icon_bg=”#03002e” icon_padding=”10px|12px|10px|12px|true|true” layout=”classic” show_text=”off” btn_padding=”0px|0px|0px|0px|false|false” btn_bg_color=”RGBA(255,255,255,0)” _builder_version=”4.23″ _module_preset=”default” custom_margin=”50px||||false|false” custom_padding=”25px||||false|false” custom_css_before=” content: %22SHARE THIS%22;|| font-size: 16px;|| font-weight: 700;|| line-height: 22px;|| letter-spacing: 0em;|| text-align: center;|| color: #ff5447;|| margin-bottom: 10px;|| display: inline-flex;|| position: absolute;|| margin-top: 10px;” border_width_top_main=”1px” border_color_top_main=”#e4e4e4″ border_radii_icon=”on|5px|5px|5px|5px” global_colors_info=”{}” custom_css_before_last_edited=”off|desktop”][ba_social_share_child _builder_version=”4.23″ _module_preset=”default” global_colors_info=”{}”][\/ba_social_share_child][ba_social_share_child network_type=”facebook” _builder_version=”4.23″ _module_preset=”default” global_colors_info=”{}”][\/ba_social_share_child][ba_social_share_child network_type=”linkedin” _builder_version=”4.23″ _module_preset=”default” global_colors_info=”{}”][\/ba_social_share_child][ba_social_share_child network_type=”email” _builder_version=”4.23″ _module_preset=”default” global_colors_info=”{}”][\/ba_social_share_child][\/ba_social_share][\/et_pb_column][\/et_pb_row][\/et_pb_section]<\/p>\n","protected":false},"excerpt":{"rendered":" Most businesses are familiar with the standard invoicing process: the supplier issues the tax invoice and the purchaser pays. Simple, right? Not exactly. In some special cases, the process is flipped on its head \u2013 and that\u2019s where Recipient Created Tax Invoices (RCTIs) come into play. If you\u2019re dealing with multiple suppliers or contractors, or […]<\/p>\n","protected":false},"author":35,"featured_media":0,"menu_order":0,"template":"","format":"standard","meta":{"_et_pb_use_builder":"on","_et_pb_old_content":"","_et_gb_content_width":"","inline_featured_image":false,"_lmt_disableupdate":"no","_lmt_disable":"","footnotes":""},"class_list":["post-296646","glo","type-glo","status-publish","format-standard","hentry"],"yoast_head":"\n\n
When can you create an RCTI?<\/h2>\n
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How to create a valid RCTI<\/h2>\n
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Gross profit vs net profit<\/a>
What is marginal cost?<\/a><\/p>\n