The ATO on Mon 6.1.2014, issued a Decision Impact Statement on the Full Federal Court’s decision in FCT v Crown Insurance Services Ltd [2012] FCAFC 153. In that case, the Full Federal Court, in a majority decision, dismissed the Commissioner’s appeal from a 2011 AAT decision that held that insurance premium income derived by a non-resident insurance company (incorporated in Vanuatu) was not sourced either directly or indirectly from Australia and was therefore not assessable to the company. The Commissioner’s subsequent application for special leave to appeal to the High Court was refused on 6 June 2013. The ATO said since the majority of the Full Court concluded that the question decided by the AAT was one of fact, the decision has no precedential impact. It also said the AAT’s decision will have no application beyond the particular circumstances of the case.

[FJM Note:    Whilst strictly correct (about ‘source’ questions being questions of fact) the source cases do give guidance on other source cases, and the Commissioner fought this all the way to the High Court and lost. It is overly glib to say that the decision has ‘no precedential impact’. It may be closer to the truth to say that it is not a precedent on any question of law.]

[LTN 2, 6/1/14]