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This page features a selection of recent cases of potential interest to our members and subscribers, as well as news updates from the Association. You can subscribe below to stay up to date with new posts.

Please note that this page is not a complete listing of all tax cases, but focuses on decisions of presidential members of the Administrative Appeals Tribunal, the Federal Court, and the High Court. Decisions may be removed from time to time.

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Pike v Commissioner of Taxation [2019] FCA 2185

TAXATION – residency of taxpayer – where the taxpayer moved to Australia from Zimbabwe – where the taxpayer was first an Australian permanent resident for migration purposes and then an Australian citizen – where the taxpayer’s de facto wife and children reside in Australia and are citizens – where the taxpayer lived and worked in Thailand for eight years – where the taxpayer subsequently lived and worked in Tanzania and the United Arab Emirates – where the taxpayer maintained a rented family home in Australia – where the taxpayer returned to Australia sporadically – definition of “resident” in s 6(1) of the Income Tax Assessment Act 1936 (Cth) – ordinary meaning of “resident” – whether the

Wing and Commissioner of Taxation (Taxation) [2019] AATA 5547

Taxation – Income tax – Division 7A of the Income Tax Assessment Act 1936 –assessable income – small business CGT rollover concession under Division 152 of the Income Tax Assessment Act 1997 not available – exemptions under ss109J and 109M of the Income Tax Assessment Act 1936 not established – no grounds established to convert into a loan complying with the requirements of s 109N of the Income Tax Assessment Act 1936 - no basis for exercising a discretion under s 109RB of the Income Tax Assessment Act 1936 - Shortfall penalty under s 284-75 of the Taxation Administration Act 1953. Full decision here

Miley and Commissioner of Taxation (Taxation) [2019] AATA 5540

TAXATION – whether the applicant satisfies the maximum net asset value test – valuation of assets immediately before a CGT event – method to determine the market values of shares in a private company – whether non-competition clauses have value separate from the value of a company – restrictive covenants – applicant does not meet the maximum net asset value test – decision under review affirmed – PENALTIES – reasonably arguable case – penalties decision set aside. Full decision here

Skourmallas and Commissioner of Taxation (Taxation) [2019] AATA 5535

TAXATION – Goods and Services Tax (GST) - input tax credits - creditable acquisitions – whether applicant carrying on business as a motor dealer – whether acquisition of a luxury motor vehicle in the course of an enterprise – whether of a private or domestic nature – whether applicant acquired the vehicle – Luxury Car Tax (LCT) – whether vehicle acquired and used only as trading stock – time for testing intention and use as trading stock - burden of proof discharged – decisions set aside. Full decision here

Commissioner of Taxation v Eichmann [2019] FCA 2155

TAXATION – CGT concessions – “active asset” – land used for storage of materials used by construction company – land not “used ... in the course of carrying on a business”. TAXATION – private rulings – review by Administrative Appeals Tribunal – whether Tribunal found and relied on facts not existing in the scheme the subject of the ruling – findings were inferences from scheme facts. Full decision here

ACN 154 520 199 Pty Ltd (In Liq) and Commissioner of Taxation (Taxation) [2019] AATA 5981

TAXATION – GST – input tax credits – gold industry – creditable acquisition – whether applicant made first supply of that precious metal after its refining – meaning of precious metal – meaning of refining – whether ordinary or trade meaning – interpretation of word in statutory context – general anti-avoidance provisions – whether taxpayer engaged in scheme – whether taxpayer obtained a GST benefit – whether an entity that entered into or carried out the scheme or part of the scheme did so with the sole or dominant purpose of the taxpayer getting a GST benefit from the scheme – whether the principal effect of the scheme or of part of the scheme is that the taxpayer gets the GST benefit from

Deputy Commissioner of Taxation v Huang [2019] FCA 2122

PRACTICE AND PROCEDURE – application for summary judgment – tax related liabilities –– no defence –stay application against the execution of judgment – strength of objections to amended assessments – place of effective management of company – central management and control of company – whether prejudice would be suffered – relevance of freezing order over Australian assets – application dismissed. Full decision here

Melbourne Apartment Project Pty Ltd (as Trustee for Melbourne Apartment Project) v Commissioner of T

TAXATION – private ruling - statutory interpretation - A New Tax System (Goods and Services Tax) Act 1999 (Cth) s 38-250(1)(b)(i) – meaning of “supply of accommodation” – whether phrase encompasses supply of freehold title to an apartment – supply of freehold title to apartments in scheme to assist disadvantaged persons to obtain housing a “supply of accommodation” – private ruling set aside and Commissioner directed to reissue in amended terms. Full decision here

Commissioner of Taxation v Bosanac (No 5) [2019] FCA 2126

TAXATION – application to vary, set aside or permanently stay summary judgment given in favour of the Commissioner of Taxation – where the assessments the subject of the summary judgment were subsequently amended – whether the order should be varied, set aside or stayed – whether the summary judgment was interlocutory – consideration of r 39.05 and r 41.03 of the Federal Court Rules 2011(Cth). Full decision here

Commissioner of Taxation v The Trustee for the Michael Hayes Family Trust [2019] FCAFC 226

TAXATION – public trading trusts – whether a unit trust is a public trading trust – whether an exempt entity had the right to acquire or become the holder of units in the unit trust that entitled it to not less than 20% of the beneficial interests in the income or property of the unit trust – whether s 102P(10) of the Income Tax Assessment Act 1936 (Cth) on its proper construction provides for a proportionate tracing of units through one or more interposed trusts. TAXATION – trust income – whether trustee of a trust exercised the power to accumulate income by crediting its accounting profit to a “Retained Profits Account” rather than distributing it to the unitholders – whether financial

Commissioner of Taxation v Scone Race Club Limited [2019] FCAFC 225

SUPERANNUATION – whether respondent race club was liable to pay a superannuation guarantee charge in respect of riding fees paid to jockeys during the relevant period – whether jockeys engaged to ride in races or barrier trials were employees of the respondent race club within the extended definition in s 12(8)(a) of the Superannuation Guarantee (Administration) Act 1992 (Cth) – whether the primary judge erred in holding that the respondent race club discharged its burden to show it was not “liable” to pay riding fees to jockeys engaged by owners or trainers – appeal allowed. TAXATION – appeal from objection decision in the Court’s original jurisdiction under s 14ZZ of the Tax Administrat

Commissioner of Taxation v Racing Queensland Board [2019] FCAFC 224

SUPERANNUATION – whether principal racing authority liable to pay superannuation guarantee charges – construction of s 12 of Superannuation Guarantee (Administration) Act 1992 (Cth) – whether principal racing authority is “employer” of jockeys – whether principal racing authority liable to pay riding fees to jockeys – where principal racing authority stated that it would pay jockeys – where principal racing authority in fact paid jockeys – where principal racing authority prepared recipient created tax invoices reflecting liability to pay – whether payments made “on behalf of” another person – where amounts paid not reimbursed by another person. TAXATION – appeal from objection decision –

Fastbet Investments Pty Ltd v Deputy Commissioner of Taxation (No 5) [2019] FCA 2073

ADMINISTRATIVE LAW – jurisdictional fact review – formation of reasonable belief – alleged failure to take into account a relevant consideration – approach to discerning relevant considerations or relevant factors – discussion of application of Peko-Wallsend test – whether Peko-Wallsend test applicable to particular facts of particular cases. TAXATION – security bond demands – relevant factors for determining whether “otherwise appropriate” to require security bond demand – whether consideration must be given to impact on recipient of requiring security – whether Commissioner can lawfully receive cash for discharge of mortgage security. Full decision here

Commissioner of Taxation v Pavihi [2019] FCA 2056

TAXATION – contraventions of s 68B of Superannuation Industry (Supervision) Act 1993 (Cth) – promotion of illegal early release of funds from superannuation accounts – statement of agreed facts and joint submissions provided by the parties – declarations made and penalties ordered in substantially the form agreed by the parties. Full decision here

GSJW and Commissioner of Taxation (Taxation) [2019] AATA 5170

TAXATION – application for review of an objection decision – whether to grant release of tax liabilities – whether Applicant would suffer serious financial hardship if required to satisfy his eligible tax liabilities – poor compliance due to medical condition known as Attention Deficit Hyperactivity Disorder (ADHD) – income/outgoings test – assets/liabilities test – other relevant factors - whether Applicant paid debts ahead of meeting taxation obligations – whether Applicant acquired assets ahead of meeting taxation obligations – whether a poor compliance history – Reviewable Decision set aside and substituted with a new decision granting partial release. Full decision here

HFTS and Commissioner of Taxation (Taxation) [2019] AATA 5164

TAXATION – objection to income taxation assessment – objection to penalty assessment – nature of unexplained deposits – whether the deposits were loans – whether the Commissioner’s assessment was excessive – 14ZZK – whether the applicant could show his actual income – whether a penalty assessment was appropriate – whether the penalty should be remitted – income tax assessment decision affirmed – penalty remitted in part. Full decision here

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