Two taxpayers (a couple) have been partially successful before the NSW Civil and Administrative Tribunal in seeking the primary production land tax exemption for 2 properties. The Tribunal allowed the exemption under s 10AA of the Land Tax Management Act 1956 (NSW) for one property but not the other.
The Commissioner had denied the land tax exemption sought for the 2 properties for the 2008 to 2013 land tax years. The taxpayers claimed the 2 properties were used for primary production, namely the maintenance of horses for the purpose of selling them or their bodily produce and therefore were exempt from land tax. The Commissioner accepted the properties were used for maintaining horses during the relevant period, but disputed whether that was sufficient for the primary production exemption to apply.
The Tribunal held the taxpayers had discharged the onus of proving that one of the properties during the relevant period was rural land used for primary production (horse breeding) within the meaning of s 10AA(3)(b). Among other things, the Tribunal accepted the taxpayers’ evidence that the property was “never rented and was well adapted to horse breeding…”. However, in relation to the other property, the Tribunal considered the additional commerciality test applied and that the taxpayers had not discharged their burden of proof. The Tribunal was of the view the evidence did not warrant a finding that the horse breeding business on the property was during the relevant period a substantial commercial venture being engaged in for the purpose of profit on a continuous or repetitive basis.
(Skinner & Anor v Chief Comr of State Revenue [2014] NSWCATAD 66, NSW Civil and Administrative Tribunal, Walker SM, 16 May 2014.)
[LTN 100, 27.5.14]