The ATO on Fri 11.10.2013, released a Decision Impact Statement on the Full Federal Court’s decision in Bell v FCT [2013] FCAFC 32. In that case, the Full Federal Court confirmed that a family trust failed the maximum net asset value test for the purposes of accessing the CGT small business concession in respect of a $6m gain made by the trust to which the taxpayer beneficiary was presently entitled.
In doing so, the Full Court affirmed the original AAT finding that a loan of $2m taken out by the trust to enable a distribution to the taxpayer was not a liability that related to any asset of the trust. It also confirmed that a id=”mce_marker”m debit liability in a bank account of the taxpayer’s wife could not be netted off with a credit amount in a related offset account as they were separate accounts and that, in any event, the liability related to an excluded asset – namely, a family home. The High Court subsequently refused the taxpayer special leave to appeal from the Full Federal Court decision.
The ATO said the decision of the Full Federal Court which the High Court determined was not attended with sufficient doubt to warrant the granting of special leave to appeal, was consistent with its views and current practices.
[LTN 197, 11/10/13]