---
title: "RCTI meaning: the invoice the school creates on the agent's behalf"
description: "An RCTI — recipient-created tax invoice — is an invoice the payer creates for the supplier. How Australian schools use RCTIs to pay education agent commission."
lastModified: "2026-08-27"
wordCount: 358
url: https://qualyhq.com/glossary/rcti
---
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# RCTI (recipient-created tax invoice)

> An RCTI — recipient-created tax invoice — is an invoice the payer creates for the supplier. How Australian schools use RCTIs to pay education agent commission.

**An RCTI — recipient-created tax invoice — is a tax invoice the buyer of a service creates on the seller's behalf, instead of waiting for the seller to invoice. Australia's tax office allows it under a written agreement between two GST-registered businesses. Schools use it for agent commission because the school, not the agent, knows exactly who enrolled and what is owed.**

The logic is simple once you see it: **the party with the data issues the document.** An agency can't correctly invoice a university for commission when only the university knows which of its students enrolled, survived the census date, and at what rate. So the roles flip — the school computes the commission, creates the tax invoice on the agency's behalf, and sends it along with the payment. Outside Australia the same arrangement is usually called **self-billing**.

In practice: a college owes an agency AUD 3,300 including GST for a semester's placements. Instead of the agency guessing and invoicing, the college issues an RCTI listing the students and amounts, pays it, and the agency books it as income. Nobody chases signatures; nothing waits on a small business in another timezone producing a correctly itemised invoice.

Three conditions keep it legal and sane. There must be a **written RCTI agreement** between the parties before the first one is issued; **both parties must be GST-registered** — which is why overseas agents usually sit outside the mechanism, their commission handled under cross-border rules instead; and when the school's math is wrong, you dispute a document *they* created, so keep your own student-by-student records. (We're a payments company, not your accountant — the ATO's RCTI rules are the source.)

A master agent can use the same instrument downstream for Australian-registered [sub-agents](/glossary/sub-agent.md). How the paperwork fits together — invoice, RCTI, [remittance advice](/glossary/remittance-advice.md) — is covered in [sub-agent commission payments](/blog/sub-agent-commission-payments.md) and [how schools pay agent commission](/blog/how-schools-pay-education-agent-commission.md).

*Reviewed July 2026.*

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