Daily Archives: March 2, 2017

*Re Pala and FCT – Accountant’s failure to remit PAYG on his own remuneration results in penalties for ‘intentional disregard of the law’ and uplift [28]

The AAT has affirmed that a taxpayer, a sole director and employee of a company, was liable to an administrative penalty of 75% for the 2006 to 2008 years in relation to PAYG amounts deducted from salary and wages which were not remitted to the ATO. The taxpayer was a qualified accountant who had practised…

Re Suburban Property Owner and FCT – No deduction for interest on inter-entity loans – insufficient evidence [27]

The AAT has affirmed the Commissioner’s decision that a company was not entitled to claim interest deductions of $11m over a 10-year period in respect of loans apparently made to it by a related company. It did so on the basis of what it said was the paucity of primary evidence supporting the existence of…

*Re Siddiqi and FCT – Amended assessments following cash economy audit mainly affirmed [26]

The AAT has held that a taxpayer had failed to discharge the onus of proving that disputed bank deposits were not the result of payments received in the course of conducting his business activities for the 2008 and 2009 income years. In May 2010, the taxpayer was selected for a cash economy audit by the…

*Re Sully and FCT – Taxpayer was a resident of Australia: domicile test satisfied [25]

The AAT has held a taxpayer was an Australian resident for the income year ended 30 June 2009 as he had satisfied the domicile test under s 6(1) of the ITAA 1997. The taxpayer worked as a marine engineer and left Australia in April 2008 to work for a company in Dubai. During the relevant…

*Re Nelson and FCT – Taxpayer not carrying on primary production business – activities preparatory [24]

The AAT has affirmed that a taxpayer was not carrying on a business of primary production during the 2004-2009 years of income on his 500 acre property in Queensland and that therefore he was not entitled to deductions in respect of improvements he made to the property and other expenses he incurred. Essentially, the AAT…

*Government to rename the Federal Magistrates Court as the ‘Federal Circuit Court of Australia’ [23]

The Federal Attorney-General announced on Thur 13.9.2012, that the Federal Magistrates Court will be renamed the Federal Circuit Court of Australia, and the title of Federal Magistrate will be renamed Judge. The Federal Magistrates Court has occasionally handed down tax-related decisions, such as the decision in Tang & Anor v Bassili & Ors [2011] FMCA…

*Fowler v FCT – date of acquiring share option rights: taxpayer loses before Federal Court [22]

The Federal Court has dismissed a taxpayer’s appeal and held that he did not acquire a right with respect to share options for the purposes of Div 13A of the ITAA 1936 until 30 November 2006. In the 2007 income year, the taxpayer, through a company called Tess Aust Pty Ltd, acquired 742,500 options in…

*Bell v FCT – CGT – Court finds the ‘net asset value test’ failed because an money was held in an interest off-set account instead of being used to pay off the mortgage – even though another loan in trust did relate to assets [21]

The Federal Court has dismissed a taxpayer’s appeal from the decision in AAT Case [2012] AATA 45, Re Bell and FCT in which the AAT found that the taxpayer failed to qualify for the CGT small business concessions in relation to a capital gain of $6m made by a family trust to which the taxpayer…

*DCT v Bollands & Ors – Freezing orders varied to allow taxpayer access to funds for legal expenses [20]

The Federal Court has allowed a taxpayer’s interlocutory application to vary freezing orders to allow the taxpayer to access funds to meet “reasonable legal expenses” in relation to a complex dispute with the Commissioner over an $11.8m tax debt. The freezing orders were made in relation to funds held by a related trust to which…

*Thorpe v FCT – AAT ordered to rehear case after reproducing the Commissioner’s submissions without attribution (no independent thought?) [19]

The Federal Court has remitted a matter to be heard and decided again by the AAT after finding that the AAT had made an error of law amounting to a constructive failure to exercise its jurisdiction by substantially reproducing the Commissioner’s written submissions verbatim and without attribution in its reasons for its decision. The substantiative…