The NSW Court of Appeal has held that a taxpayer was entitled to object to a decision of the Chief Commissioner of State Revenue (NSW) to issue notices to third parties to ascertain taxable facts of the taxpayer for payroll tax purposes.
The matter concerned legal proceedings before the NSW Administrative Decisions Tribunal between the taxpayer and the Commissioner. As part of an investigation into an individual and his relationship with a number of companies, including the taxpayer, the Commissioner issued s 72 notices to various entities to ascertain taxable facts of the taxpayer (and others).
The taxpayer, who was not a recipient of a notice, lodged written objections to the Commissioner’s decision to issue the notices, which the Commissioner disallowed. The Commissioner subsequently issued payroll tax assessments to a number of companies, including the taxpayer, for the period 1 July 2003 to 30 June 2010, on the basis that the companies were to be grouped as the individual was their sole director and shareholder.
Before the Court, the Commissioner argued the taxpayer was not entitled to lodge written objections in relation to the decision to issue the notices under s 86(1)(b) of the Taxation Administration Act 1996 (NSW), and therefore, the taxpayer could not apply to the ADT for review. The Court said the issue before it was the meaning of “dissatisfied” in s 86(1). The Court was of the view that s 86(1)(b) was not limited to decisions having an immediate and direct effect on a person’s actual or potential liability to tax. It agreed with the taxpayer that “dissatisfied” in the context of s 86(1) should be given its ordinary meaning of “displeased” and that the taxpayer was “displeased” with the decision to issue the notices because they threatened the findings of facts that would render it liable to payroll tax.
(Chief Comr of State Revenue v Print National Pty Ltd [2013] NSWCA 96, NSW Court of Appeal, Bathurst CJ, Beazley P, Gzell J, 17 April 2013.)
[LTN 82, 2/5/13]