The AAT has refused a taxpayer’s application for an extension of time to lodge an objection in relation to a capital gain on disposal of shares which occurred in the 2005 year.
For the year ended 30 June 2005, the taxpayer lodged an income tax return prepared by her accountants, which included a net capital gain of $9,551 in relation to the disposal of shares. In May 2006, a notice of assessment was issued based on the return as lodged. In December 2011, the taxpayer applied for a private ruling re capital losses on her investment. She received a favourable reply in March 2012 applicable to the year ended 30 June 2010. In April 2012, the taxpayer asked the Commissioner to apply that ruling to her 2005 assessment and to refund the CGT she had paid. In June 2012, the taxpayer lodged an objection against the 2005 assessment but the Commissioner refused to grant her an extension of time to lodge the objection. The taxpayer contended that due to the favourable findings of the private ruling, she should be able to apply that ruling to the 2005 year. She also contended that she was not adequately advised in 2005 that an objection could be lodged.
The AAT held that the taxpayer had not demonstrated an adequate explanation for the delay in lodging the objection, and that her case was without legal merit. It said in seeking to apply the 2012 private ruling to the 2005 year, the taxpayer was seeking to achieve a benefit in retrospect. Therefore, the AAT held the taxpayer had not demonstrated an arguable case and refused to grant an extension of time to lodge an objection.
(AAT Case [2013] AATA 96, Re Flood and FCT, AAT, Ref No 2012/3737, Handley SM, 22 February 2013.)
[LTN 38, 26/2/13]