On 29.4.21, the ATO issued a Decision Impact Statement (DIS) on the JobKeeper case: CofT v Apted, where the Full Federal Court upheld an application for an ABN, with a retrospective start date, prior to the 12 March 2020 date, was effective. The Commissioner recognises the broad effect of the decision and has amended his Practice Statement accordingly.

See below for further details.

[Tax Month – April 2021]

 


 

The ATO has released a decision impact statement (DIS) on FCT v Apted [2021] FCAFC 45. In that case, the Full Federal Court upheld the AAT’s decision to exercise the “later time” discretion in s 11(6) of the Coronavirus Economic Response Package (Payments and Benefits) Rules 2020 (the “CERP Rules“) to extend the date by which the respondent had to have an effective ABN, thereby allowing him to qualify for JobKeeper payments.

The Commissioner accepts the Court’s view that the discretion under s 11(6) of the CERP Rules to allow a later time to have an ABN is not restricted to the limited circumstances envisaged in the extrinsic material to the CERP Act and CERP Rules. The discretion allows for the consideration of a “broad range of circumstances” – and the approach must be guided by the purposes of the CERP Act and the CERP Rules, having regard to the integrity rules in their context. The Commissioner considers that this approach also applies to the discretions to allow a later time to provide notice of assessable business income/taxable supplies contained in ss 11(7) and (8) of the CERP Rules.

In response to the Court’s decision, the ATO has updated Law Administration Practice Statement PS LA 2020/1Commissioner’s discretion to allow further time for an entity to hold an ABN or provide notice to the Commissioner of assessable income or supplies. The notable updates are those that clarify factors relevant in considering whether or not it is appropriate for the ATO to exercise discretion. Other changes are mostly machinery in nature to update language and references.

Those entities who applied for JobKeeper (and cash flow boost) who had their applications denied on the basis that they were not carrying on an enterprise/did not have an ABN as at the relevant date (ie in the case, 12 March 2021) should seek advice about having the ATO review the decision.

COMMENTS: are due by 26 May 2021.

CofT v Apted [2021] FCAFC 45 – Catchwords

TAXATION – application for Coronavirus economic response payment (jobkeeper payment) –

  • whether respondent eligible for jobkeeper payment –
  • whether respondent “had an ABN on 12 March 2020” within the meaning of s 11(6) of the Coronavirus Economic Response Package (Payments and Benefits) Rules 2020 (Cth) (CERP Rules) –
  • where respondent was not registered for an ABN on 12 March 2020 –
  • where respondent was later registered for an ABN with a “date of effect” covering 12 March 2020 –
  • held respondent did not have an ABN within the meaning of s 11(6) of the CERP Rules –
  • whether the Commissioner’s decision not to exercise the discretion in s 11(6) of the CERP Rules to allow a later time for the respondent to have an ABN forms part of the reviewable decision –
  • held Commissioner’s decision not to exercise the later time discretion was part of the reviewable decision – whether Tribunal erred in exercising the discretion to allow a later time in the respondent’s favour – held Tribunal did not err in exercising discretion –
  • appeal dismissed

[30.4.21 – LTN 81, 30/4/21]

About the author