The Commissioner has been successful before the AAT in a matter concerning the quantum of “consideration” for GST purposes received by a taxpayer on a taxable supply of land to a third party.
The matter centered on the Commissioner’s amended assessment of a GST net amount of $59,283 for the December 2007 quarter on the sale of the land. The Tribunal heard details as to how the transfer of the land to the third party came about and the various documents evidencing the relevant transactions along the way. Essentially, the third party had lent money to the taxpayer to purchase a property. There were executed documents (a “Loan Term Sheet” and a “Contract for the Sale of Shares” in which the third party was “caveator”), which acknowledged that the taxpayer was indebted to the third party for $652,118.50. Subsequently, after subdivision of the property, a lot was transferred to the third party, which discharged the taxpayer’s loan liability.
Before the Tribunal, the taxpayer argued that the consideration for the supply was $521,484, being an amount recorded as a loan in the taxpayer’s financial accounts on the date of transfer of the land (5 October 2007). In contrast, the Commissioner’s contended that the consideration for the supply was $652,118.50, being an amount specified in the relevant documents as the amount indebted to the third party.
The AAT accepted the Commissioner’s contention and held the taxpayer had not discharged its onus of proving that the amended assessment was excessive. Among other things, the AAT found the financial statements were not sufficient to establish that the consideration was $521,484. Among other things, the AAT noted the financial statements were not audited. Further, the taxpayer did not call on witnesses to support its application. Accordingly, the Commissioner’s decision was affirmed.
(AAT Case [2013] AATA 186, Re Brookdale Investments Pty Ltd and FCT, AAT, Ref No: 2012/3132, Walsh SM, 27 March 2013.)
[LTN 62, 3/4/13]